Sergio Alberto Gramitto Ricci and Christina M. Sautter

How Retail Investing Improves Corporate Governance and Benefits Society

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Since 2020, new retail investors have flooded the securities markets, opening a record number of new brokerage accounts. Due to the ease of investing through commission-free trading apps and the ability to purchase fractional shares, a broader segment of the population is beginning to partake in direct investing. A 2020 FINRA-NORC study of new retail investors found that there has been an increase in the racial and ethnic diversity of new investors. More specifically, new investors in 2020 were 58 percent White, 17 percent African American, 15 percent Hispanic/Latino, and 10% percent Asian. By contrast, a 2019 study found that … Read more

WallStreetBets, GameStop, and the Rise of ESG Retail Investors

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The GameStop and meme-stock trading frenzy are evidence of a potential revolution in corporate governance and signal the rise of Generation Y (“Millennials”) and Generation Z (“GenZ”) as retail investors. In a new article, we discuss how these investors, who we call wireless investors, could set in motion a social movement able to change the way shares are held and voted and, ultimately, redefine the purpose of public corporations. The social movement will start with wireless investors exercising their right to vote their shares and, by doing so, promoting their environmental, social, and governance (“ESG”) values. This will cause … Read more