Retail Crowd Beats the S&P 500 as Soaring Trading Sparks Concern

Individual investors are buying stocks like never before and leaving the broader market in the dust. But at the same time, a surge in trading volume is raising fears that retail’s favorite positions are getting dangerously crowded.

Citigroup Inc.’s basket of 46 stocks most favored by non-professional investors, which includes companies like SoFi Technologies Inc. and Riot Platforms Inc., is up 30% since the start of September, beating the S&P 500 Index’s 4.3% gain. Meanwhile, retail trading volume has increased to an all-time-high, the bank’s equity trading desk wrote in a research note Tuesday.