Traders work on the floor of the New York Stock Exchange (NYSE) on September 16, 2026 in New York City, USA.
Gina Moon | Reuters
Institutional investors control the stock market.
Retail traders, who have been buying big for years, appear to be on the sidelines. At the same time, Vanda Research data shows large investors are holding on to stocks despite a spike in U.S. Treasury yields.
“Institutional investors have surprisingly weathered this week’s macro volatility,” Viraj Patel, global market strategist at Vanda, said in a letter to clients on Friday.
Data shows option flow from institutional investors is about three times higher than in September of previous years.
Patel said despite a turnaround in big money flows over the past five sessions. 10 years and 30 years US Treasury yields have risen to their highest level in more than a decade. He said this was a “rational and constructive signal of risk appetite” among institutional investors hidden within a broader story of risk aversion.
Patel said institutional traders are buying select artificial intelligence pieces amid volatility.
he pointed to meta platform Especially as last week’s top pick. Shares of Facebook’s parent company rose nearly 13% in the week following the debut of the Muse Charm device. The stock has been gaining momentum since Meta announced its personal AI agent, Muse, earlier this month.
“Macro uncertainty hasn’t stopped us from taking risks,” Patel said. In fact, “investors are becoming increasingly selective.”
Meta, 5 days
Retail industry loses volume share
Retail traders performed in a big way in 2025, with some declaring that they had shed the title of “stupid money.” Their performance played a role in their decision to buy on the spur of the moment during the market downturn following President Donald Trump’s tariffs.
However, Goldman Sachs believes that the share of individual investors is S&P500 Trading volume has been declining since its peak about a year ago. The bank said it is now more than three percentage points below the five-year average.
The S&P 500 closed up more than 1% last week despite pressure from rising U.S. Treasury yields. This progress has lifted the monthly benchmark into positive territory.
