After a superb performance in 2025, retail investors continue to show themselves as a force to be reckoned with in 2026. February was the fifth strongest month for net retail buying in the last five years on Citadel Securities’ platforms, according to the firm’s head of equity and equity derivatives strategy Scott Rubner. That’s despite the month being a slowdown compared to a surge of net retail buying in January . Mom-and-pop trader flows in 2025 surged to record levels , with those investors often disproportionately “buying the dips” instead of believing stocks were heading in long-term negative directions. That signature trade continues in 2026 , Rubner said. “Year-to-date, average net notional traded on our platform has been 2.5x larger on S & P down days than on up days,” he wrote. “While overall average daily net notional moderated in February, the intensity of dip-buying actually increased: net notional on February S & P down days was 4.3x that of up days (vs. 2.1x in January).” It’s a trend that is still in place this month. While U.S. equities this week sold off at the open during the last two trading days on worries over the U.S.-Iran war, they stormed back and turned positive Monday and significantly pared losses Tuesday as investors bought the dips. .SPX 5D mountain .SPX five-day chart. Rubner added retail traders are about to get an influx of cash that could make them even bigger players in the market. Due to President Donald Trump’s ” big beautiful bill ,” tax refunds are expected to be higher-than-normal in 2026. Investors should expect the refunds’ potential impact on the market to increase in the next two months. Rubner said only 30% of refunds have been distributed by March 1, while that figure is expected to rise to around 75% by May 1. When that money might get deployed is uncertain, as inflows into money market funds typically increase in February and March, Rubner said. That implies investors might not immediately move tax refund money into equities. But retail traders certainly will have the cash to increase their presence if they please, he said. “Elevated money market balances combined with refund seasonality indicate that incremental retail liquidity remains available into March,” Rubner wrote.
