US retail trading activity hits record highs

Following the Financial Industry Regulatory Authority's (FINRA) decision in June to eliminate a rule that restricted investors with less than $25,000 in account equity from executing more than three day trades within five business days, retail trading activity accelerated. At Robinhood, the average number of daily trades in August increased by 31% year over year for stocks and 67% for options.

At Webull, the average number of daily revenue-generating trades rose by more than 70% in both stocks and options. A study conducted by US universities also found that retail options trading increased by as much as 24% following the regulatory change. While brokerage firms argue that the new rules have improved market accessibility, investor advocacy groups warn that increased short-term and high-risk trading could expose retail investors to greater potential losses.