Flood of new retail traders flocking into the stock market and most of the brokerage firms across the world reporting surge in trading accounts.
Does it feel like 2008? Obviously not. A recent surge is people are started seeing stock markets as an alternative income as the interest rates are reducing and frequent lockdown brings the risk of job loss.
Small-time investors might tasted the success of profits from their sofas due to the recent uplift from the stock prices.
It it a Herd Mentality?
Could be the starting point of herd mentality. Everybody knows that the herd mentality push the new investors and traders to get into dangerous ideas and risking their money in penny stocks and other dangerous trading instruments.
The number of newbie investors trading during the pandemic is surging, with mobile trading app Robinhood adding 3 million new accounts in the first quarter alone.
Thanks to the gamification of trading mobile apps which draws too much of novice investors/trader’s attention.
we know how this frenzy retail flocking story ends. It might look like it is easy that even a common man can dive into stock markets and make money and at the end the herd crowd will become the prey to those professional big money players!