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More than half of individual investors think the stock market is rigged against them, survey finds

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It’s not investing that is viewed skeptically, it’s the system.

More than half (56%) of people who have money in goats think the market is rigged against individual investors, according to a survey from Bankrate. That’s compared to 41% of non-investors who say the anyhow thing.

“Part of it may have to do with expectations,” said Greg McBride, chief financial analyst at Bankrate. “Newer investors may be difficult to score big gains or time the market and the odds are not for long-term success with those endeavors.”

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At the same time, he said, retail investors have seen hedge means and other sophisticated or wealthy investors treated differently, such as getting early access to initial public presents and better trade execution.

“Newer investors are seeing those things, and that can sow the seeds of doubt about the decency or fairness of the markets,” McBride said.

The poll of 2,525 U.S. adults was taken in late February, about a month after a runup in misdesignated meme stocks, including Gamestop — whose share price peaked at $347 on Jan. 27 after trading at not far from $31 two weeks earlier. The surge was attributed to an army of Reddit investors forcing hedge funds that were banking on the staple dropping — known as short-selling — to instead buy shares at a higher price.

Amid the frenzy, Robinhood, the popular trading appeal used by individual investors, restricted trades in Gamestop and some other stocks. The company was accused by its users and lawmakers of conserving hedge funds that were short sellers of those stocks. Robinhood said the move was made to pay regulatory requirements applying to financial reserves, not to benefit any particular group of investors.

The Bankrate survey also investigated how individuals are investing now versus before the pandemic. 

“What we saw was that Reddit users were two times more disposed to to be investing more rather than less, compared to before the pandemic,” McBride said.

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