A trader works on the floor at the New York Stock Exchange (NYSE) in New York City, U.S., Nov. 10, 2025.
Brendan McDermid | Reuters
Professional investors have been using the market’s record-setting run as an opportunity to take profits, while retail investors have been doing much of the heavy lifting in the latest run of the three-year-old bull market.
Hedge funds and other institutional clients have been the biggest net sellers of single stocks and exchange-traded funds this year, unloading more than $67 billion worth of equities in 2025, according to the latest client-flow data from Bank of America.
Retail investors have been the market’s backbone, the most consistent dip-buyers since 2020, a behavior forged during the pandemic rebound, the Wall Street investment bank said. That strategy has paid off handsomely as the S&P 500 reached multiple all-time highs this year. Retail investors’ steady inflows of fresh cash during market pullbacks have positioned them ahead of many institutional investors who stayed cautious amid rate-cut uncertainty and geopolitical conflict, from trade wars to Gaza, Ukraine and Iran.
That tension will be in focus this week as scores of high-profile institutional investors gather at CNBC’s Delivering Alpha Investor Summit on Thursday in New York City, offering the world a chance to hear how some of the industry’s most influential voices are navigating this volatile market.
The first week of November also saw the biggest net selling of technology shares in two years from hedge funds and other big investors as fears of sky-high valuations mounted.
Even as professional money managers hesitated during earlier pullbacks this year, small investors repeatedly stepped in, helping sustain the rally in megacap technology stocks as well as more speculative pockets of the market.
The pattern appears to be evolving, however. BofA noted retail enthusiasm is showing early signs of fatigue after the market’s relentless run-up.
