US margin debt just fell $85 billion in July—the biggest monthly drop ever recorded. We're now at $1.42 trillion, and this is the first decline since March.
For context, the second-largest monthly drop was $80 billion back in January 2022, right as the bear market kicked off.
What makes this wild: May and June saw a record $198 billion surge in margin debt—the biggest 2-month jump on record. Then July wiped out nearly half of it in one month.
Zoom out: Despite this record decline, margin debt is still up $518 billion (+58%) since the start of 2025.
Levered investors got hammered last month. When margin debt swings this violently, it's usually a sign that positioning got too crowded and the market forced a reset. Worth watching how this plays out in August.
For context, the second-largest monthly drop was $80 billion back in January 2022, right as the bear market kicked off.
What makes this wild: May and June saw a record $198 billion surge in margin debt—the biggest 2-month jump on record. Then July wiped out nearly half of it in one month.
Zoom out: Despite this record decline, margin debt is still up $518 billion (+58%) since the start of 2025.
Levered investors got hammered last month. When margin debt swings this violently, it's usually a sign that positioning got too crowded and the market forced a reset. Worth watching how this plays out in August.