Key Highlights

  • Retail trading fell to 9% of US equity volume, the lowest share since 2020, according to Goldman Sachs data as reported on October 26, 2026. That is a notable drop in small-investor activity.
  • Retail volume is down about 20% since mid-summer and more than 40% since late 2025, a sign that meme-style enthusiasm has faded from the market.
  • The S&P 500 sits within about 1.8% of its record, so SPDR S&P 500 ETF Trust (NYSEARCA:SPY), which tracks the index, is near a high even as small-investor participation drops.
  • Robinhood (NASDAQ:HOOD) reports after the close on October 27, with options implying a move of about 10.4%, so the retail slowdown meets a live test.

What the Goldman Data Show

Goldman Sachs data show that retail investors made up 9% of US equity volume, the smallest share since 2020. Over a longer span the decline is sharp: roughly 20% since mid-summer and more than 40% since late 2025. The measure is a share of total volume, so it can fall either because individuals trade less or because institutions trade more. The report describes the first cause, a fading of meme-style enthusiasm. The figure comes from one report of the bank's data, and the underlying methodology was not captured. The S&P 500 rose 0.70% to 7,676.77 on October 26, 2026, so the drop in retail share came alongside a rising market.

Why Retail Share Matters for Index Funds

SPDR S&P 500 ETF Trust (NYSEARCA:SPY) holds the 500 stocks of the S&P 500, so its moves reflect large-company shares that institutions dominate. Retail flows tend to matter more for small, heavily traded names and for options. A low retail share can mean less speculative froth, which some investors view as healthy, but it can also remove a source of buying that supported rallies earlier in the cycle. Breadth was thin on October 26: Nasdaq new lows of 349 exceeded new highs of 82, even as the index closed higher. That mix, a rising index with narrow participation, is a reason some strategists urge caution. Nasdaq stocks showed the same split, with weak breadth beneath the headline gain.

Risks and What to Watch

One risk is a reversal: retail activity can return quickly when prices jump or a theme catches on. Another is that the figure is a snapshot and may be revised. Robinhood is the nearest listed test of retail appetite, reporting October 27 after the close against consensus of USD 0.57 EPS on USD 1.5 billion of revenue. The Federal Reserve decides on October 28, and a hawkish tone could cool risk appetite further. Investors should also watch whether individual trading rises when the market bounces, or whether the share stays near 9%. Watch also whether retail participation recovers after the Fed decision rather than assuming the slide continues.

Where Things Stand

The answer is that retail volume is at 9% because speculative enthusiasm has faded, according to Goldman Sachs data, while SPDR S&P 500 ETF Trust (NYSEARCA:SPY) stays near a high on institutional demand. The lower share is not by itself a sell signal. The next catalysts are Robinhood results on October 27 and the Fed decision on October 28. The data come from one report. This is not investment advice.