Margin Debt Rises to $1.53 Trillion as U.S. Investors Increase Leverage

U.S. investors are chasing stock market highs through high leverage, with margin debt increasing by approximately $86 billion to reach $1.53 trillion as of June, marking the third consecutive month of growth and setting a new record. Meanwhile, the net credit balance in U.S. brokerage accounts fell by about $70 billion in a single month, dropping to a negative $1.061 trillion, a historic low. The continued deterioration of the net credit balance indicates a reduction in investors' cash buffers and an increased reliance on borrowing for stock positions. Leverage is widespread throughout the brokerage system in the U.S. During rising phases, stock prices can elevate account net worth, further releasing financing capacity and creating mechanical buying; however, once the market weakens, margin pressure may force investors to add cash or sell stocks, leading to leveraged funds converting into mechanical selling. Currently, U.S. stocks face a high valuation and high financing environment, and if new funds slow down, leveraged positions may further amplify market volatility.