Retail Broker Growth

Following this week’s Reddit-driven trading activity in GameStop and other heavily shorted names, we thought it may be interesting to look at deposit behavior across some of the newer brokerage platforms. With many Americans recently benefitting from the second round of stimulus, we also cohort behavior by those that did/did-not receive stimulus checks.

Robinhood and their gamified approach to investing, saw the highest year-over-year growth, including around the time of the April’20 and January’21 stimulus, up >750% for stimulus recipients, and ~500%-600% for non-recipients.

Betterment and Stash also saw spikes in deposit growth in April’20 and January’21. Interestingly, they both show more pronounced growth for stimulus recipients, especially in the recent second round. This may be related to these providers’ focus on capital preservation, and the propensity for lower income stimulus recipients to utilize these funds to increase savings.