Retail traders bought $2.1 billion worth of stocks in a single day last week - the most on record

• Retail traders bought $2.5 billion of stocks last Friday, a daily record, Vanda Research said.
• The retail inflows came as the S&P 500 had a losing week.
• While retail investors poured into value stocks, institutional investors exited.

Retail traders purchased $2.1 billion worth of stocks last Friday alone, a single-day record.

The size of retail purchases last Friday was high compared to the "relatively mild drawdown" of 1.3% that the S&P suffered, said Vanda Research senior strategist Ben Onatibia and analyst Giacomo Pierantoni in a Wednesday note.

"Retail investors tend to buy more equities on days when the S&P sells off. Friday was not an exception," the researchers said.

Millennial investors are jumping back into the stock market amid "the recent recovery in portfolios along with the rotation out of cryptocurrencies," they said, noting the group has been responsible for the "wild moves in meme stocks."

Meme stocks have come back into the spotlight recently after retail traders drove a massive rally in AMC Entertainment's stock price, starting last month. Since then, other meme classics like GameStop and BlackBerry have also been volatile, and new companies, like ContextLogic and Workhorse, and even a tiny Texas oil driller and a biopharmaceutical firm have joined the group of retail-trader favorites.

Though retail investment into equity markets have been significant, they have run counter to flows from institutional investors for the most part, the analysts said.

For example, last week retail investors poured into value stocks, while institutional investors did just the opposite, unloading their massive positions following the Federal Reserve meeting, which announced an accelerated interest-rate hike schedule in 2023.

Institutional investors also have been focused on tech stocks, while retail demand for the sector has been "very underwhelming," the researchers said.

Retail investors have instead been focused on sectors such as financials, materials, and energy, which have seen combined inflows of $1.7 billion in the past two weeks, Vanda said. Sectors such as gaming, cryptocurrencies, and cannabis stocks also have seen price changes alongside retail inflows.