Valuation Takes a Backseat, Capital Is King: How Retail Investors Are Becoming the New Pillar of Wall Street

Glonghui January 9th｜For skeptics who question how much further the U.S. stock market can go after its surge, one of the market's dominant forces—retail investors—remains firmly bullish. According to analysis by Arun Jain, an analyst at J.P. Morgan Securities, the buying frenzy among retail investors has continued into the new year after a record performance in 2025. Data from the institution shows that the purchase volume in the first four trading days of January reached the second highest level in nearly eight months, with daily purchase volumes consistently above the 85th percentile of historical observations, highlighting exceptionally strong confidence. This confidence has helped stabilize the market during recent pullbacks. Given this group's growing influence on Wall Street, if retail investors continue to snap up stocks, the rally in U.S. equities is likely to persist. Steve Sosnick, chief strategist at Interactive Brokers, stated: "The market seems to be driven more by capital flows than by valuations. Therefore, as long as individual investors are willing and able to put money into the stock market, it's a positive signal for the broader market."