Confidence in US long-term potential rises after two quarters of decline
Magnificent 7 shares see decreased retail investor curiosity
Majority (83%) of traders belief USD as international reserve forex
Wednesday tenth September 2025 – Retail traders are regaining confidence within the US market’s long-term potential after two quarters of decline and have elevated their publicity, in keeping with the newest quarterly Retail Investor Beat from buying and selling and investing platform eToro.
The analysis, which surveyed 10,000 retail traders throughout 12 nations, reveals that 38% now view the US because the area with the strongest long-term return potential, a 12% enhance from the earlier quarter. This reverses the development of consecutive declines of 9% in Q1 and 17% in Q2. This confidence can also be mirrored in retail traders’ portfolios. 43% now have publicity to the US market, an 8% enhance from the earlier quarter and a report excessive for the reason that begin of eToro’s Retail Investor Beat in Q1 2023.
Commenting on the info, eToro’s International Market Strategist Lale Akoner, mentioned: “Earlier this yr, heightened issues round political instability and macroeconomic uncertainty within the US prompted retail traders to diversify extra aggressively into Europe and rising markets, usually scaling again US publicity.
“Now, as confidence within the resilience of the US economic system improves, we’re seeing a reversal of that development. Portfolios are as soon as once more tilting again towards the US, reflecting recognition that, regardless of international diversification, the American market stays the cornerstone of world investing. Retail traders are successfully balancing diversification with a transparent acknowledgment that long-term development alternatives are nonetheless closely anchored within the US.”
Rising variety of traders scale back publicity to Magnificent 7
When requested how they consider the so-called ‘Magnificent 7’ (Amazon, Apple, Microsoft, Meta, Tesla, Nvidia and Alphabet) will carry out as a bunch in 2025, retail traders expressed a measured outlook. 13% anticipate these shares to considerably outperform the market, whereas 33% consider they’ll solely barely outperform.
The information revealed that the variety of traders planning to scale back their investments has elevated marginally throughout all of the ‘Magnificent 7’ shares in comparison with a yr in the past – Meta, Apple, Nvidia and Tesla every noticed a 2 proportion level enhance, whereas the remaining companies skilled an increase of 1 proportion level. Retail traders have additionally barely decreased their publicity to all of those main US tech shares. Notably, the variety of traders who aren’t invested in or don’t plan to spend money on Tesla elevated by 6 proportion factors. Solely Meta, Alphabet and Nvidia skilled a marginal rise within the proportion of traders planning to extend their investments.
Lale Akoner added: “The so-called ‘Magnificent 7’ have dominated markets in recent times, however rising focus threat is prompting traders to reassess. The most recent information present retail traders are trimming publicity, not as a result of they doubt the long-term potential of those corporations, however as a result of overreliance on a handful of tech giants leaves portfolios weak in a risky atmosphere.
“This shift alerts a extra disciplined method: traders are acknowledging the Magazine 7’s energy whereas actively rebalancing to enhance diversification. It displays a maturing mindset amongst retail traders – transferring from chasing efficiency to managing threat extra strategically.”
12 months on yr adjustments in retail investor sentiment in the direction of Magazine 7 (Q3 2024 vs Q3 2025)
USD stays unchallenged as international reserve forex
While retail traders proceed to arrange for a possible long-term weakening of the USD, with 50% having adjusted or planning to regulate their portfolios (up from 48% within the earlier quarter), the bulk (83%) trust within the US greenback remaining the worldwide reserve forex for the subsequent 10 years, whether or not they consider the greenback will weaken (33%), strengthen (22%) or stay secure (28%).
Solely 7% of retail traders consider the US greenback will lose its international reserve standing throughout the subsequent decade. Of these 25% again bitcoin, the Chinese language yuan, or the euro respectively, adopted by gold (23%) and central financial institution digital currencies (16%).
Lale Akoner commented: “The US greenback has been the world’s main reserve forex for over 70 years. Its dominance has endured by means of varied financial upheavals, together with the collapse of the Bretton Woods system and the 2008 international monetary disaster. Regardless of the USD seeing a decline of round 9% this yr, pushed primarily by Washington’s fiscal trajectory, retail traders nonetheless firmly consider within the USD’s pivotal function as a world reserve forex. On the identical time, they’re adjusting methods to hedge towards volatility and shield long-term returns.”
International recession fears ease
The most recent Retail Investor Beat reveals that recession fears are easing. Whereas the worldwide economic system and a possible recession stay retail traders’ prime perceived menace to their portfolio, concern has fallen from 26% in Q2 to ranges seen a yr in the past (23%). Inflation stays in second place at 19%.
In distinction, 14% of traders now see their dwelling economic system as the most important threat, up from 11% final quarter. Taking a rustic by nation view, US traders are essentially the most involved (28%), adopted by the UK (20%), Australia (17%) and France (15%), whereas Germany, Spain, and Italy stay beneath the typical at 12% every.
Lale Akoner added: “Renewed confidence within the US market, a cornerstone of world monetary stability, helps clarify why fewer traders now view the worldwide economic system as the most important threat to portfolios. But this optimism doesn’t lengthen to the home image. US traders stay involved about their very own economic system, reflecting proximity to political and coverage choices that amplify perceptions of threat.
“Inflation, in the meantime, stays a key concern, however has stabilised. This means retail traders are adjusting to a higher-for-longer atmosphere and shifting their focus from systemic international shocks to native financial dynamics. The general temper is cautious however more and more pragmatic.”
ENDS
Notes to editors
About this reportThe most recent Retail Investor Beat was primarily based on a survey of 110,000 retail traders throughout 132 nations and three continents. The next nations had 1,000 respondents: UK, US, Germany, France, Australia, Singapore, Italy and Spain. The next nations had 600 respondents: Netherlands, Denmark, Poland, Romania, and the Czech Republic.
The survey was carried out from 5 – 19 August and carried out by analysis firm Opinium. Retail traders have been outlined as self-directed or suggested and needed to maintain at the least one funding product together with shares, bonds, funds, funding ISAs or equal. They didn’t should be eToro customers.
Media contactspr@etoro.com
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