Retail investors, the group that turned pandemic-era markets into a live-action casino, appear to be getting a bit more careful. JPMorgan’s latest research signals that individual traders are showing signs of caution around leveraged products like options and margin trading, particularly in the tech sector that has been the primary beneficiary of their enthusiasm.
The timing is notable. Speculative tech stocks surged 57% year-to-date by early June 2026, dwarfing the S&P 500’s 11% gain over the same period. That kind of divergence tends to make strategists nervous. JPMorgan is no exception.
The leverage party might be winding down
Small traders piled into call options during April and May 2026, riding the momentum in tech names that were already running hot. That buying activity helped fuel a rally that looked, on paper, spectacular.
But the underlying participation tells a different story. Retail investors’ share of US equity trading dropped to 17% in Q1 2026. While a rebound is expected in Q2, the composition of that activity matters more than the raw number. JPMorgan’s strategists have flagged the riskiest corners of the tech sector as overextended, and the bank’s own traders reportedly shifted to a more defensive posture in early June amid rising volatility and selling pressure in tech stocks.
