Millennial day-traders are putting Wall Street to shame as investors bank on a V-shaped recovery

Millennial day-traders are putting Wall Street to shame as investors bank on a V-shaped recovery
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Dear Readers,

A strange dynamic is afoot in the stock market.

The institutional heavyweights on Wall Street are being beaten at their own game by upstart day-traders and retail investors — and it’s not been particularly close. The latter group has reaped a massive 61% return since the market bottom on March 23, easily outpacing hedge funds (45%) and mutual funds (36%).

Goldman Sachs tracks these companies in a “Retail Trading Favorites” basket, which we unpacked here, including the stocks that have soared the most since late March.

Needless to say, this outperformance has not been an easy pill to swallow for the old guard. CNBC host Jim Cramer said last week that markets are in for a “real bruising” because “everyone thinks they’re smarter than Warren Buffett.”

He was referring to the spiking interest — and subsequent gains — in beaten-down airline stocks from millennial investors using platforms like Robinhood. Buffett, of course, famously dumped all his holdings in the Big 4 airlines at the peak of coronavirus. Cramer’s argument matches that of many bewildered experts, who think this type of unabashed risk-taking can only end in disaster.

Source: Business Insider

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