Foreign Retail Investors to Drive $500B Equity Wave in US

JPMorgan’s latest projection indicates a substantial influx of up to $500 billion from retail investors into U.S. equities by year-end—building on more than $270 billion accumulated in the first half of 2025. The trend underscores a growing influence of individual traders in the stock market, with momentum today rooted in technology and AI-related exposure. Retail demand is already reshaping supply-demand dynamics for large-cap shares, creating fresh rally potential.

The strength of this wave lies in its dual-engine uplift: domestic inflows complemented by emerging foreign interest as the dollar stabilizes. The potential $50–100 billion in global capital could amplify market participation. However, analysts also caution that heavy retail focus could exacerbate volatility during macro disruptions—especially given the influence of momentum and sentiment in these cohorts.

Strategists suggest that the broader market will increasingly reflect retail behavior: sectors favored by consumer sentiment and tech optimism will outperform. ETF volumes and trading volumes are already shifting accordingly. For institutional investors, the task shifts from chasing alpha to managing behavioural asymmetries driven by retail flows.