Retail investors are stepping in to purchase software shares and other equities that have fallen amid concerns about artificial intelligence-driven disruption, according to trading metrics from Citadel Securities.
Scott Rubner, head of equity and equity derivatives strategy at Citadel Securities, told clients in a Tuesday note that "net notional on our platform has reached levels we have never observed before." He added that the scale, persistence, and breadth of retail buying have "materially exceeded prior peaks, underscoring retail's role as a primary source of incremental demand in early 2026."
The firm, which has tracked this data since 2017, reported that average daily dollar demand for U.S. equities from January 2 through February 13 was approximately 25% higher than the prior peak in 2021, and about double the 2020 to 2025 average. That surge in cash-market buying has coincided with elevated activity in options markets.
Citadel's year-to-date data shows average daily options volume in 2026 is nearly 50% above the 2020 to 2025 average and more than 15% higher than last year. Rubner emphasized the consistency of retail options behavior, noting that "retail options investors have skewed toward net buying in 41 of the past 42 weeks, a consistency that points to sustained risk appetite rather than sporadic positioning."
The recent wave of selling across certain software and publishing names began after Anthropic PBC introduced a productivity tool aimed at in-house legal teams, sparking a rout among legal-software and publishing stocks. The move widened when Altruist Corp. launched a tax-strategy tool that pressured shares of Charles Schwab Corp. and LPL Financial Holdings Inc.
While hedge funds and other professional investors have been raising short positions at a record pace, retail traders have moved in the opposite direction by buying into the weakness. Citadel's data also indicates that retail interest is not confined to technology: investors have been purchasing shares across materials, real estate, financials, communication services, and industrials so far this year.
The mixed positioning between professional and retail participants highlights a market undergoing active repricing as new AI tools prompt reassessment of software providers' competitive positions and revenue durability. Citadel's metrics portray retail investors as a significant source of incremental demand during the early months of 2026.
Clear summary
Citadel Securities reports record retail buying in U.S. equities and historically high retail options activity as investors buy software and other stocks sold off amid concerns that new AI tools threaten existing business models. Professional investors have been increasing shorts while retail demand has broadened across multiple sectors.
Key points
- Citadel says net notional on its platform reached unprecedented levels, with average daily dollar demand Jan 2-Feb 13 about 25% above the 2021 peak and roughly double the 2020-2025 average.
- Options activity is elevated: average daily options volume in 2026 is nearly 50% above the 2020-2025 average and over 15% higher than last year; retail has been net buying in 41 of the past 42 weeks.
- Retail buying has spread beyond technology into materials, real estate, financials, communication services, and industrials, while hedge funds have increased short positions sharply.
Risks and uncertainties
- Continued professional shorting could add downward pressure to stocks perceived as vulnerable to AI, affecting financials and software names.
- Retail buying concentration in certain sectors may be vulnerable to reversals if further AI-related developments accelerate repricing in those industries.
- Elevated options positioning by retail traders introduces the possibility of heightened volatility in equity and options markets.