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U.S. margin debt surged to a new record in May, recording an increase in investor borrowing as stock markets continued to set new highs.
Data released by FINRA showed margin debt rose by $112 billion during the month, bringing the total to $1.42 trillion. The increase marked the second consecutive monthly gain and pushed borrowing levels beyond previous peaks recorded during earlier market cycles.
At the same time, the S&P 500 advanced 5.1% in May, pushing market valuations and investor leverage to historic highs.
The latest figures show that investor borrowing expanded by $195 billion over the last two months. Compared with a year earlier, margin debt increased by $495 billion, a 53.7% increase. After adjusting for inflation, margin debt rose by 7.9% from April and 47.4% from May 2025.
U.S. margin debt growth outpaces stock market gains
Long-term data show borrowing has expanded faster than stock market performance. Since 1997, inflation-adjusted margin debt has increased by 550%. Over the same period, the inflation-adjusted S&P 500 gained about 358%.
BREAKING: US margin debt jumped by +$112 billion in May, to a record $1.42 trillion.
This marks the 2nd consecutive monthly increase, totaling +$195 billion.
Margin debt has surged +$495 billion, or +54%, over the last 12 months.
Adjusted for inflation, this metric rose +7.9%… pic.twitter.com/DrambJNRpa
— The Kobeissi Letter (@KobeissiLetter) June 18, 2026
However, a divergence in growth rates emerged during the recovery from the tech crash. Notably, the recent trend shows the gap widening, with margin debt growing much faster than the market.
Charts tracking both measures show that margin debt and stock prices often move in the same direction. However, the pace of borrowing has picked up more in recent years. The latest data places margin debt at both nominal and real record highs.
According to market data, leverage has risen since late 2023. Investor borrowing has more than doubled during that period. The increase has occurred alongside continued gains in U.S. equities, creating a gap between debt growth and market appreciation.
The U.S. margin debt represents funds that investors borrow from brokers through margin accounts. The borrowed capital allows investors to purchase larger positions than their available cash would otherwise permit.
Previous peaks coincided with market trend points
Past data reveal that there have been times when the margin debt ratio was high, and the market summits relatively low. During the final stages of the tech bubble, margin debt increased rapidly, peaking in March 2000. The S&P 500 would go on to close at its highest value of the year in August.
The same trend was followed in the run-up to the global financial crisis. Margin debt increased in the 2006-2007 period and reached its high point in July 2007. It took three months until the S&P 500 hit its new all-time high.
Another rise, as reported by Cryptopolitan, followed the pandemic recovery period. Margin debt reached a high in October 2021. The S&P 500 reached its peak in December 2021 before declining through 2022. Margin debt later bottomed in December 2022 after the market downturn.
Additional data measuring investor credit balances shows a different side of market positioning. The indicator combines free credit cash accounts and credit balances, then subtracts margin debt.
As of May 2026, the reading stood at negative $991.7 billion, the lowest level on record. The data shows that investors collectively owed more than they held in cash.
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