This trend creates opportunities and challenges for industry leaders.
Retail investors are now a driving force in U.S. financial markets, accounting for nearly half of trading activity.
This transformation was the focus of a recent panel discussion at the Benzinga Fintech Deal Day & Awards event, where industry leaders explored how technology enables access and reshapes the relationship between Wall Street and Main Street.
Once considered a peripheral activity, retail trading has now taken center stage. Panelists from Public, Alpaca, TradeZero and GTN Americas shared their insights on how this shift creates new opportunities and challenges.
A New Era for Retail Participation
Eric Krueger, CEO of GTN Americas, reflected on the evolution of retail trading. "When I started at Merrill Lynch in 1998, my first trade was $1,000 worth of Microsoft stock, and I paid $100 in commission," he said.
Fast forward to today, and retail investors can trade for free with advanced tools at their fingertips. "It's remarkable how accessible trading has become," Krueger added, noting that the rise of retail investors is reshaping the U.S. equity markets.
Brandis DeSimone, vice president at Nasdaq Inc. and panel moderator, emphasized the staying power of retail trading. "Retail is here to stay," she stated, highlighting its growing influence on market activity.
Bridging Access With Technology
Stephen Sikes, COO of Public, emphasized how technology transforms retail investors' engagement with the market. "Investors today expect real-time information and 24/7 access," he explained, adding that platforms must adapt to meet these demands. Public has integrated tools like AI to help users analyze market trends, providing a seamless experience tailored to modern needs.
TradeZero CEO Daniel Pipitone, added that the most important aspect is education. "We work with trusted educators to teach strategies and tips on managing risk," he said. "It's not about giving advice but empowering investors with the right tools."
While education is vital, Sikes argued that making mistakes is part of the learning curve for retail investors. "We can't be overly protective. Mistakes are how people learn," he said.
Yoshi Yokokawa, CEO of Alpaca, stressed the importance of cost reduction in driving global retail participation. "To serve Main Street effectively, we've focused on building internal systems to reduce costs and make the business sustainable," he explained, noting that affordability is critical for global adoption.
Expanding Main Street Beyond Borders
The panel also explored how retail investing is becoming a global phenomenon. Krueger revealed that 90% of the trading volume from GTN's international clients is directed toward U.S. markets.
"Investors worldwide want to own stocks like Apple, Amazon, and Tesla," he said, attributing the U.S. market's appeal to its long-standing outperformance.
Yokokawa shared similar trends, stating that many international platforms are building U.S.-style offerings to meet growing demand. "We work with brokers in over 35 countries, and U.S. equities remain the most sought-after," he said.
The Road Ahead
The panel concluded with a look at how platforms can continue to serve retail investors. Sikes emphasized the importance of creating user-friendly solutions, such as the Public's bond account, simplifying access to fixed-income products.
"Retail investors don't wake up thinking about buying bonds," he said. "They think about finding attractive yields, and it's our job to provide those solutions."
As DeSimone summarized, the rise of retail investors is reshaping markets, forcing Wall Street to adapt. The gap between Wall Street and Main Street continues to narrow through education, technology, and global access.
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