Goldman Sachs, Morgan Stanley, and JPMorgan have captured nearly 80% of top-five bank equity trading revenues this year, generating a combined $52 billion. This surge in revenue was driven by hedge funds borrowing heavily to make leveraged bets on AI hardware and Asian semiconductor supply chains.
The three banks' massive balance sheets allow them to absorb potential losses and manage risks that smaller rivals cannot handle. Relaxed rules around leverage have also helped unlock bank balance sheets to meet record demand, though the International Monetary Fund has cautioned against rising leverage.
Fueled by the global boom in artificial intelligence stocks, relaxed capital rules, and greater lending to hedge funds, the five biggest investment banks have generated about $67 billion in equities revenue through September 30. This is $7 billion more than what the group made during all of 2025, which was itself a record year.