Just trade anything: Retail investors push the envelope with oil trading

• Retail investors now move in and out of commodities, precious metals, currencies, Oscar ballots — following the latest hot macro or geopolitical trend or even a news event.

Where it stands: This "post-modern" trade, as one proponent is calling it, was impossible to ignore over the past few weeks as retail investors flocked to trade oil futures.

Between the lines: Trading oil futures is typically not for the fainthearted. It is the province of big institutional investors, hedge funds and large corporate consumers.

• The barriers to entry, until recently, were high. You can't just trade a contract on, say, a single barrel of oil. CME sells contracts in blocks of 1,000 barrels — and investors need ample reserves to protect against margin calls.

State of play: Trading activity for options on the United States Oil Fund exchange-traded fund was 76 times that of typical volumes on Apex's retail platform, according to a report the company released Wednesday.

• It also surged on TradeXYZ, an offshore exchange where you can trade "perpetual" oil futures and other things using digital currency 24 hours a day. Just Wednesday, $1.5 billion in volume traded on its popular Brent oil future contract.
• TradeXYZ, is basically an app than runs on Hyperliquid, a popular new crypto-trading exchange that operates offshore and was founded by a Harvard grad.

Flashback: Before it was oil, it was silver — retail traders drove a squeeze in the precious metal earlier this year.

Zoom out: It's not simply that retail is trading oil. It's that retail is trading everything, says Kaledora Kiernan-Linn, a Harvard grad who cofounded Ostium, another offshore platform where you can trade futures, stocks, metals and crypto using crypto.

• "The whole concept of being a crypto trader or being a stock trader or an FX trader has almost eroded," she says, calling it "post-modern."

Follow the money: It's why Polymarket and Kalshi have also gained traction. People are trading and betting on whatever they can.

• "I think it's a bigger phenomenon in culture, which is just ... the trading culture and the hyper-financialization culture that's broadening," says Cosmo Jiang, a general partner at Pantera Capital, which is invested in Hyperliquid.
• "People like to call it financial nihilism."

Friction point: This is risky stuff. The new crypto platforms operate outside the U.S. and aren't regulated or backstopped. They're technically off limits in the U.S., but that hasn't stopped them from growing in popularity.

The bottom line: Back in the GameStop era, traders thought, "Cool company. Do I like the stock?" says Mike Treacy, vice president of risk at Apex.

• Investors are now asking very different questions about geopolitics and the macro economy, and making moves well outside the confines of a strip mall video game store.