U.S. Margin Debt Hits Record $1.5 Trillion as Investor Leverage Jumps 49%
Updated
Updated · The Motley Fool · Jul 24
U.S. Margin Debt Hits Record $1.5 Trillion as Investor Leverage Jumps 49%
2 articles · Updated · The Motley Fool · Jul 24
Summary
$1.5 trillion in U.S. margin debt in June marked a record, with balances up 49% from a year earlier as investors kept borrowing against stocks near market highs.
That buildup reflects a broader reach for risk, with leveraged ETFs and out-of-the-money options becoming easier to access and potentially magnifying any selloff beyond margin loans alone.
Past surges in margin growth have preceded major peaks: balances rose 72% in 2021 before the 2022 top, 63% in 2007 before the financial-crisis slide, and 80% in March 2000 near the dot-com bust.
The current level is less extreme by one measure—about 2.3% of S&P 500 market value, roughly in line with the long-run average—but elevated valuations near 20 times expected earnings could still leave leveraged investors vulnerable to forced selling.