The Bottom 50% of Americans Have Seen Their Portfolio Value Increase 500% Over The Last Half Decade

To investors,

We are living through a K-shaped economy where the wealthy continue to get wealthier and those without investment assets fall further behind. This divide is ultimately the driver so many societal issues, but thankfully we are starting to get some good news that proves there is a light at the end of the tunnel.

Citadel Securities points out the value of public equities held by the bottom 50% of households has increased nearly 500% since 2020.

During this timeframe, the S&P 500 increased nearly 100%, so the data suggests the bottom 50% of households have seen a significant relative improvement from where they were a half decade ago.

Now this does not mean that this cohort at the lower end of the economic ladder are good stock pickers. Instead, the gains in portfolio value are more likely attributable to more people opening brokerage accounts, more people putting a larger percentage of their savings into the stock market, the stock market rising about 2x in 5 years, and the various government stimulus packages finding a way to get more money into people’s hands.

To make it dead simple, people have more money and they are choosing to put a larger percentage of it in the market. That is very different than being excellent investors.

In fact, most investors are bad at beating the market. Chris Camillo highlights “only 22% of funds beat the market this year.” Financial firm Jefferies says this means stock pickers are poised for the worst annual showing in decades.

This makes sense when you think about the volatility we have experienced in 2025. Most capital allocators were very excited as President Trump took office because he is known to focus on policies that make the stock market go up in value. But almost immediately after taking office, Trump and his team levied tariffs on almost every trading partner and investors got spooked. They started predicting doom and gloom, which led to a 20% sell-off in stocks.

Within weeks, the administration started to strike trade deals, cut back on the tariff levels, and talk the market back into optimism. The rest was history. Stocks, bitcoin, and gold took off higher. Bessent was on TV every other day talking about running the economy hot so we could grow our way out of the problem. And the enthusiasm around achieving a balanced budget fell to the wayside as investors realized the national debt is going higher under both political parties.

This context is important because it highlights how much further we still have to go for the average American family. Yes, the bottom 50% of Americans have seen their collective equity portfolio value increase 5x in the last few years, but that cohort still only owns about 2.5% of total assets. Not exactly an encouraging ownership stake on a relative basis.

This brings me to the current government shut down. Put aside the fact that most shut downs are merely egotistical soap operas for certain politicians and we can focus on the fact that the average American is still in a bad spot.

Chris Cuomo hosted an event with various celebrities, politicians, and commentators at The Kennedy Center this week. There is an important clip of Stephen A. Smith going off on folks sitting with him on stage after an air traffic controller in the audience says he has to work a second job on DoorDash to help his child afford education.

Take a listen to this:

Now we can easily connect the issue Stephen A. Smith is talking about with the rise in equity investing. People have no other choice. They can’t save their way to financial security. This is an important point — wealthy people talk about financial freedom, but the average American is much more focused on financial security. You can’t worry about retiring if you are worried about affording your bills.

Given this context, it was funny for me to see former IMF chief economist Gita Gopinath screaming about the potential destruction of wealth if the stock market crashed. Quite literally, she is warning that investors have too much exposure to the stock market, so a crash would be harmful to the world.

I wish all economists would be intellectually honest and say “people around the world was forced to become investors because savers have their wealth stolen by undisciplined monetary policy that produces inflation.”

We can’t have it both ways. We can’t complain that rich people own too many assets, while also complaining that the world owns too much public equities. Either we want more people to join the asset owner class or we want less. It doesn’t seem like a difficult decision to me.

American capitalism has provided more economic mobility than any other system in the world. It has allowed people to come from any geography, any sex, any religion, or any background and create a life of financial prosperity.

Encouraging more people to invest is not only a net positive, but it likely would have a more profound impact than most philanthropic efforts. The meritocracy of financial markets provides opportunity to those who need it most. And if stocks are going to double every five years, people will be just fine with the periodic market drawdown.

We know the government can’t stop printing money, so lets hope every citizen positions themselves to benefit from the stupidity, rather than sits on the wrong side of the table as a saver.

Hope you have a great day. I’ll talk to everyone tomorrow.

- Anthony Pompliano

Founder & CEO, Professional Capital Management

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