- Wall Street can now keep an eye on retail-trader activity through JPMorgan's new tracker, Bloomberg reported.
- The "Through the Retail Lens" tool tracks social media activity and predicts short-squeeze opportunities.
- About 30 institutional investors have begun using the tool, Bloomberg said.
A new tool from JPMorgan allows Wall Street firms to keep an eye on what retail traders are doing, according to a Thursday report from Bloomberg.
The bank's "Through the Retail Lens" tool launched in September and is now being used by about 30 asset and quant fund managers, Bloomberg reported. The new tool shows retail flows, predicts the next "short-squeeze," and combs through Reddit and Twitter to determine retail traders' sentiment on a stock, the report said.
A bank representative did not immediately respond to Insider's request for comment. JPMorgan told Bloomberg that without a keen eye on retail, investors may feel like they're "driving partially blind."
Retail traders have made their mark on Wall Street this year, starting in January when millions of invdividual investors rallied together on Reddit's Wall Street Bets forum to drive an epic surge in shares of GameStop, AMC, and others. The rally caused some short-focused hedge funds to lose big on their bearish positions in these companies.
Retail traders have been a driving force in the stock market broadly this year. Individual traders have been known to rush in to buy market dips, like on Black Friday this year when markets slumped on Omicron worries or in September when Chinese real-estate giant Evergrande's debt crisis sparked a selloff.
Spurred by pandemic boredom, flushed with cash from stimulus checks, and enticed by zero-commission trading, retail traders now account for about 20% of stock-market activity, Insider previously reported, citing Citadel Securities. That's a jump from 2019 when it was about half that.
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