....looks like the 'shoe shiner' or 'taxi driver' is all-in in the stock market.
....this alluring 'get rich quick' market is sucking in new market participants clueless to the upcoming risks and could prove to be disastrous to those who can't afford to lose their capital.
...someone with $100k may be tempted to use all their $100k to 'punt' the market because a 20% exposure i.e$20k won't bring much return since e.g 30% return on $20k is just $6k. But in their quest to make 30% on their $100k i.e $30k, they could risk losing half of their capital or the $50k which would be a life changing loss.
Now if that someone has e.g $1mil at his/her disposal, he/she could allocate 20% to equities to try for 30% gain, which could give $60k nominally more material than $6k, while a 50% loss on capital equates to $100k (1/10 of capital)
...the above example only serves to illustrate why those with less capital could be tempted to take a higher equity exposure risk to stand to gain a material return. But at the expense of taking a risk they can't afford at this juncture of the market.
BREAKING: The median value of US consumers’ stock holdings spiked to $250,000 in October, the most on record. Over the last 12 months, this amount has DOUBLED, according to the University of Michigan consumer survey. In 2010, Americans' investments in single stocks, mutual funds, and retirement accounts were worth just ~$50,000, or 5 times less. Now, equities account for 48% of US households' net worth, the highest since the 2000 Dot-Com bubble peak. This rally has truly been unprecedented. https://x.com/KobeissiLetter/status/1847318505743356410
