Look at a screen at almost any point in 2020, and chances are you saw something like this: A company that nobody had ever heard of 12 months ago was in the process of trading 20 million shares in a day.

Ideanomics, fuboTV, Vaxart — names that would have elicited a collective “who?” in January are obscure no longer, after seducing the retail day-trader horde whose presence defined the coronavirus era in equities. A mattress maker called Purple Innovation saw turnover surge 13-fold as it went from $5 to $25 in three months. Blank-check-born Fisker posted four sessions in which volume topped 40 million shares each.

Buttressed by equally huge demand for older names like Eastman Kodak and Carnival, it added up. At a time when headlines were dominated by a raging virus, recession and the fastest-ever bear market, a record $120 trillion of stock changed hands on U.S. stock exchanges this year, up 50% from 2019 to a record. The average Russell 3000 stock saw average daily share volume surge 46% to 1.9 million shares.

Among the beneficiaries: firms like Virtu Financial, the high-frequency trader that soared 55%, as well as Nasdaq and Intercontinental Exchange, both up more than 20%.

Another was Ambus Hunter IV of Baltimore, whose dabbling in New York-based electric vehicle fintech Ideanomics helped fatten his mostly blue-chip portfolio. The 34-year-old defense industry worker bought shares when they were around $1 and sold when they were near $4.

“That was a bit of a gamble, but I felt comfortable taking it, this particular year,” said Hunter, who was in college at Bowling Green State University during the financial crisis. “I was prepared. I had the cash on hand to really take it to the next level with my investments.”

Advertising

Altogether, retail traders now make up a fifth of stock volume in the U.S., double the share of a decade ago and behind only market makers and high-frequency traders in their heft, according to Bloomberg Intelligence. Quarantined at home, at least 8 million people opened new accounts in the first nine months of the year across brokerages including Charles Schwab, ETrade Financial, TD Ameritrade Holding and Robinhood Markets, all of which permit a version of free trading.

It was not a local phenomenon. Globally, trading accounts tripled from 2019, according to a survey by BrokerChooser. Small investors dominate almost two-thirds of trading in South Korea. Roughly one in three people in Saudi Arabia has a brokerage account. An online firm in the U.K. saw sign-ups on a new tax-free savings account surge 130% over the year, while Japanese online firm Rakuten Securities chalked up a 25% surge in accounts in nine months.

Besides professional traders and exchanges that feast on volume, global markets themselves were the beneficiaries. Flows from individual investors have been key in the recovery of global equities, helping push a broad MSCI gauge of worldwide shares up 14% on the year and 68% from the March bottom. While nervous about all the amateur enthusiasm, securities industries veterans found it to be a trend that was hard to knock.

“Retail market participation is necessary for both the market and society,” said Thomas Poullaouec, head of Asia Pacific multiasset solutions at T. Rowe Price. “It will be a long-lasting feature as personal saving becomes a larger share of the retirement saving.”

While COVID restrictions and global central bank stimulus have been key triggers, zero-fee investing platforms and improving technology sent the trend into overdrive by making markets more accessible. A Twitter account and an investing app now provide an experience that just a decade ago could only be possible with trading terminals.

“I’ve never had so many friends text me asking which beaten-down stocks to buy,” Jessica Rabe, co-founder of DataTrek Research, wrote to clients. “They were not fearful about losing money. They were afraid of missing out on the large snapback.”

Advertising

At one time or another in 2020, it has seemed like retail investors have been in love with just about everything that traded. First it was reopening stocks, like airlines and cruises. Then they gambled with shares of companies whose solvency was in doubt. They got involved in the option market in a major way, helping push bullish call volume to levels never before seen.

Of the 50 stocks in the Russell 3000 that saw the largest year-over-year increases in trading volume, almost a third of them appear in a compilation of the 100 most popular stocks with Robinhood users. While the biggest 100 stocks in the Russell 3000 saw average daily trading volume rise 32% this year, the smallest saw it jump 70%, data compiled by Bloomberg show.

On the flip side, small-time investors have been blamed for artificially inflating valuations, particularly in distressed companies like Hertz Global Holdings, and also for making IPOs hard to price. Retail fingerprints are all over the explosive rally in Tesla and U.S.-listed Chinese electric-vehicle makers, most of which are unprofitable.

“The rise of the retail investors has exacerbated the phenomenon of momentum trading,” said Gary Dugan, chief executive officer at the Global CIO Office. “Once a stock gets a following, it tends to drive it to exaggerated levels purely because investors only react to price action, not the fundamentals of the company.”

The transformation in trading and increased involvement of vulnerable investors is sparking concerns globally. Regulators in South Korea have sounded an alarm over a surge in individual investors’ exposure to foreign stocks, warning mom-and-pop traders that investing overseas without sufficient information, or buying shares through reckless borrowing, was risky.

As a vaccine rollout brings with it the hope of a return to normalcy in 2021, some expect retail investors may be less of a force. Critics of the craze are fast to note that the 2020 market made everyone who bought into it seem like a genius — and that genius in markets usually has a short shelf life.

Advertising

“Once there’s a vaccine and people generally go back to work, we think retail trading will settle back down a little bit,” said Bloomberg Intelligence’s Larry Tabb. “They’ll trade less often, because generally investors don’t do well with active trading unless they really know what they’re doing — and most don’t.”

For now, the boom continues. It has defied predictions it would disappear as many countries emerge from pandemic-induced lockdowns. In India, for example, more than 2 million new accounts were opened in September and October, months after the nationwide lockdown had ended.

Retail investing has surged this year even in Japan, a market where the zero-interest-rate environment has been long entrenched. Local brokerages have seen interest from individual investors sustain after the country’s state of emergency.

Online broker Rakuten Securities has seen a record pace of growth in users, with nearly 40% of users who joined this year being female, and 73% saying they had no investing experience. Retail investors made up an average of 21% of total trading value on the Tokyo Stock Exchange in the past six months, versus just 16% the year earlier.

New day traders also flocked to the Warsaw Stock Exchange this year, seeking a shield against inflation and negative interest rates, according to a survey, with almost half of those surveyed holding shares traded on a more speculative platform for smaller entities, a jump from a year ago.

Back in America, Alex Castro, 28, had better hope his acumen sticks. The Miami resident recently quit his job to focus on day trading, and now says he makes his living buying and selling momentum plays on stocks like Tesla, DocuSign and Salesforce.com.

“Sometimes,” he says, “the money I make in a day is money that my mom, for instance, doesn’t see in a whole month.”