# Retail traders bought record shares in US market yesterday

**URL:** https://tradingqna.com/t/retail-traders-bought-record-shares-in-us-market-yesterday/182422
**Category:** Industry Insights
**Created:** [May 20, 2025, 4:48am UTC](https://tradingqna.com/t/retail-traders-bought-record-shares-in-us-market-yesterday/182422 "2025-05-20T04:48:38Z")
**Posts on this page:** 1
**Showing post:** 6

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### Author: ![cvs](https://tradingqna.com/user_avatar/tradingqna.com/cvs/32/92503_2.png) [@cvs](https://tradingqna.com/u/cvs)
#### Post date: [May 21, 2025, 6:19am UTC](https://tradingqna.com/t/retail-traders-bought-record-shares-in-us-market-yesterday/182422/6 "2025-05-21T06:19:39Z")

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> [@neha1101](#):
>
> India issued India Millennium Bond in USD from NRI where interest was given at 8.5% or so. It got oversubscribed. This is our strength and moody downgrades???

IMHO, it was a sign of weakness not strength.  
In a period of low-interest rates globally,  
India had to offer 8.5% Dollar-denominated returns and ~7% Euro-denominated returns to attract investment.

> [@neha1101](#):
>
> when India has not every defaulted on its dues ever

That is just one aspect of credit-worthiness.  
The credit rating for sovereigns also accounts for  
how well established in the Global economy a sovereign is currently and in the near future,  
including their Forex reserves and revenues (even if projected).

In 2000, the US Govt. itself was offering ~6% returns over 3-10 years,

 ![image](https://tradingqna.com/uploads/default/original/3X/2/a/2a2048628ee7b36f7690bf7ebc81d634beac8f01.png)  
Source: [https://www.govinfo.gov/content/pkg/ERP-2011/pdf/ERP-2011-table73.pdf](https://www.govinfo.gov/content/pkg/ERP-2011/pdf/ERP-2011-table73.pdf)

India had to offer ~8.5% on a 5 year bond,  
to account for the additional risk that  
India might not have sufficient USD at the end of 5 years  
(however remote the possibility may be).

* * *

Also, due to competitive pressure,  
these rating agencies continued to rate highly  
even securities with known low-quality constituents.

Here’s a dramatic recreation of the same, from the movie [The Big Short (2015)](https://en.wikipedia.org/wiki/The_Big_Short_(film))

[![](https://img.youtube.com/vi/vE8E7_PNm98/maxresdefault.jpg "The Big Short: Ratings Agency "What are you 4?!"") ](https://www.youtube.com/watch?v=vE8E7_PNm98)

IMO, it is perfectly fine to ignore the upside of these credit-ratings.  
But better to pay extra attention whenever a credit-rating is downgraded.

_(FWIW, like trailing indicators in TA,  
these rating-downgrades often occur after the fact, most of the time.)_

* * *

A similar situation exists today in the Indian domestic bond market.

A bunch of NBFCs have popped-up,  
offering retail individuals access to corporate bonds  
offering returns twice as much as sovereign bonds.  
(often digitally, at a click of a button on some page).

However, upon careful consideration,  
the risk-adjusted returns on offer are only marginally higher.

 ![image](https://tradingqna.com/uploads/default/original/3X/c/e/ce3b5c658a9e7822a32896c7a116a9ef36169c33.png)

Assuming the typical “invest in bonds for stability” approach,  
the additional 0.2 - 0.3% of **[expected-utility](https://www.investopedia.com/terms/e/expectedutility.asp)** in corporate-bonds compared to GSECs, hardly seems worth it.  
Considering the impact of losing the entire principal invested, on one’s life/plans.

…or is it **[loss-aversion](https://en.wikipedia.org/wiki/Prospect_theory)** at play here ?

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