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Home/Markets & Investing/SEC RETAIL INVESTOR RULE

U.S. retail investors are no longer buying the dip — they're selling the rally, even as markets rebound

JD

Jasper Donnelly

SEC retail investor rule · Apr 9, 2026

U.S. retail investors are no longer buying the dip — they're selling the rally, even as markets rebound

Source: DojiDoji Data Terminal

U.S. retail investors are no longer buying the dip — they're selling the rally, even as markets rebound. Despite a ceasefire-triggered market recovery, individual investors pulled back aggressively, reducing ETF exposure to the lowest level in over 10 months. Trading activity for the week ending April 8 sank to the 1.2th percentile historically, with total inflows falling to $4.8 billion — well below the 12-month average of $6.6 billion.

Related Brief2d ago
initial public offering

SpaceX IPO targets 30% retail allocation to raise $75 billion

Retail investors in the U.S., U.K., EU, EU, Australia, Canada, Japan, and South Korea will have access to shares up to six times the typical 5% to 10% IPO allocation. SpaceX is setting aside as much as 30% of share allocations for retail investors, a departure from the typical IPO market. The company is aiming to raise as much as $75 billion at a target valuation of $1.75 trillion. This follows a confidential IPO filing with the SEC on April 1. Chief Financial Officer Bret Johnsen stated that retail participation will be a bigger part of this IPO than any other in history. SpaceX plans to host a retail investor event on June 11 for 1,500 attendees.

Retail investors recorded net ETF sales, driving exposure down to the 0.4th percentile by market close. Intraday selling peaked near the highest level in nearly a year, with broad-based equity ETFs like SPY and TQQQ seeing sustained outflows. Purchases of these funds hit a z-score of -2.3, the weakest in nearly 12 months. Sector ETFs fared worse, with net selling at the 0.4th percentile (z-score -3.1), and the triple-leveraged semiconductor ETF SOXL suffering its largest selloff since 2023.

Related Brief7h ago
retail investing

South Korean retail investors pivot from Tesla to SpaceX bets as tax breaks accelerate domestic shift

South Korean retail investors are pulling back from Tesla, slashing net purchases by 71% this year — a drop from over $2.6 billion to just $779 million as of last Friday — as they take profits and shift capital toward anticipated opportunities in SpaceX and domestic equities. The move reflects a strategic rebalancing, driven by both market anticipation and government incentives. Investors are positioning ahead of SpaceX’s expected IPO, which could raise up to $75 billion and value the company at more than $1.7 trillion, making it one of the largest public listings globally this year. The pivot is being accelerated by a new tax rule passed on March 31: South Koreans who transfer proceeds from overseas stock sales into domestic equities by May qualify for up to a 100% capital gains tax deduction. Samsung Securities’ Reshoring Investment Accounts have already drawn over $75 million in two weeks, with Tesla and Nvidia holdings forming a major portion of the inflows. Rather than exiting tech exposure entirely, many investors are redirecting funds into domestic aerospace-themed ETFs to gain indirect access to the SpaceX story. Samsung Asset Management’s aerospace ETF has attracted about $175 million since its launch last month. Mirae Asset, Korea Investment Management, and Shinhan Asset Management are now preparing similar products. SpaceX has confidentially filed with the SEC and could go public as early as mid-June. Its inclusion in major indexes like the S&P 500 could spark broader rerating in the space sector and draw passive investment flows. But access for South Korean retail investors remains uncertain. Regulatory mismatches in IPO rules and disclosure standards may prevent direct participation, with the Financial Supervisory Service reviewing risks to investor protection and foreign exchange stability. A fallback option would limit allocations to institutional investors, leaving retail demand unmet.

Instead, retail capital flowed into defensive areas: fixed-income ETFs drew $214 million, large-cap growth $209 million, multi-cap broad-based $192 million, and dividend strategies $182 million. Energy and tech ETFs saw net outflows of $98 million and $81 million, respectively.

Related Brief19h ago
initial public offerings

SpaceX's xAI Merger Sets Stage for Record-Breaking IPO

Investors can expect $40 billion to $80 billion in shares to be available for purchase when SpaceX goes public. This offering is a fraction of the company's total shares outstanding, as corporate insiders and venture capitalists hold the existing stakes. The impending IPO follows SpaceX's $1.25 trillion purchase of xAI. The company is expected to be valued at $1.75 trillion at the time of the offering. This would make it the biggest IPO in history.

In individual stocks, retail investors sold across nearly all sectors, with energy and industrials hit hardest. Exxon Mobil faces $700 million in sequential earnings pressure due to production disruptions in Qatar and the UAE. Meanwhile, retail investors adjusted oil exposure by reducing shorts in SCO (z-score -7.7) and increasing longs in USO (75th percentile).

Related Brief3d ago
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Ark Venture Fund provides retail access to SpaceX, OpenAI, and Anthropic before their 2026 IPO targets

Retail investors can gain early exposure to SpaceX, OpenAI, and Anthropic before they target IPOs by the end of 2026. This access is provided through the Ark Venture Fund (ARKVX), which holds SpaceX at 17% of its assets, OpenAI at 11%, and 1% of its assets in Anthropic. The fund is an interval fund, meaning investors cannot sell shares at any time. Ark provides liquidity once per quarter. Retail investors can only purchase shares through the fund's partners, SoFi and Titan Global Capital Management. Registered investment advisors can access the fund through brokerages such as Charles Schwab and Fidelity.

The Mag7 remained a narrow exception. Retail investors bought $1.376 billion in Tesla, NVIDIA, Microsoft, META, Apple, and Google — with Tesla alone attracting $494 million. Amazon was the only Mag7 stock with net selling, at -$36 million. META’s gains followed the release of a new model by its superintelligence team.

Related BriefJust now
margin trading

A three-month extension on margin rule compliance could prevent forced sell-offs in Bangladesh’s distressed market

Compliance with Bangladesh’s new margin rules by the 30 April 2025 deadline could force brokers to liquidate vast holdings of non-marginable securities, triggering fire sales in an already fragile market. The DSE Brokers Association (DBA) has formally requested a three-month extension, moving the deadline to 31 July 2025, warning that rushed implementation risks destabilising the capital market further. As of February 2025, total negative equity across brokerages and merchant banks reached Tk10,425 crore — Tk8,005 crore in principal margin loans and Tk2,420 crore in accrued interest. A total of 146 firms, including 102 DSE brokers, 39 merchant banks, and five CSE brokers, hold loans where collateral value has fallen below outstanding balances. The Margin Rules 2025, effective 1 November 2024, require full compliance on three fronts: risk-based capital adequacy, system integration, and the adjustment of non-marginable securities in loan portfolios. But brokers say they lack the time, skilled staff, and technical capacity to meet the deadline without selling off large volumes of collateral. Thousands of existing loan accounts hold significant positions in non-marginable shares, and forced sales would depress prices, hurt retail investors, and strain liquidity. The current market is already under pressure from geopolitical shocks — including the US-Iran war — and a domestic fuel crisis. Rushed implementation could lead to operational breakdowns and temporary halts in margin services. The DBA argues that a nine-month compliance window would allow for proper risk assessment, board approvals, system upgrades, and client communication. Firms are currently required to provision against margin loans not recovered within a year. But they have only set aside Tk2,946 crore — less than 37% of the Tk8,005 crore principal — leaving a Tk5,058 crore provisioning deficit. Without an extension, brokers may be forced into disorderly liquidations, deepening negative equity and prolonging market distress.

Non-individual investors sold $8.5 billion in equities, exceeding the 12-month average of $7.3 billion. Futures traders, however, bought $5.2 billion in contracts, led by S&P 500 and Nasdaq 100 futures — a divergence that underscores the unique defensive posture of retail investors.

Related BriefJust now
social security

Gas Price Surges May Inflate 2027 Social Security Raises Beyond 2026 Levels

Social Security recipients may receive a benefit increase in 2027 that exceeds the 2.8% cost-of-living adjustment (COLA) received at the start of 2026. This potential raise stems from a surge in gas and fuel prices following the Iran conflict. Because Social Security COLAs are tied directly to the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), higher fuel costs drive up the index and the resulting adjustment. Retirees typically spend less on gas than workers do. Recipients may receive a larger benefit increase without paying the full cost of the commodity driving the raise.

SEC retail investor rule

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