We recently compiled a list of the 12 Most Widely Held Stocks by Individuals in 2025. In this article, we are going to take a look at where Microsoft Corporation (NASDAQ:MSFT) stands against the other stocks widely held by individuals in 2025.
Individual investors, often called retail investors, typically invest their personal capital directly into the stock market, driven primarily by personal research, news sentiment, social media trends, or recommendations from peers. They often favor stocks of recognizable brands or companies whose products and services they use regularly, as well as growth stocks perceived to offer high return potential. While their success varies widely (often marked by emotional decision-making and mixed results) monitoring retail investor trends can be valuable, as these investors collectively have the power to significantly influence stock prices and market volatility. Understanding where retail attention is focused can provide early signals of market shifts, speculative bubbles, or emerging investment opportunities. Just to recall two recent instances when retail investors successfully short-squeezed and caused billions of losses to the smartest hedge funds in the world – as they say, even the less informed parties may occasionally win big, and it is, therefore, important to be aware of their tendencies and trends.
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The type of stocks most widely held by individuals has been changing over time, from consumer-centered brands that were popular in the ’80s and ’90s to popular dot-com names in the 2000s, and finally to technology stocks in the 2010s, as retail investors had firsthand experience with their products and platforms. One thing is certain – retail investors are often the last to jump on the ship, and periods of active inflow of retail money into stocks coincide with market peaks. A similar situation happened in the last two years, as the majority of the returns of the US stock market have been driven by a handful of 7–8 stocks with primary exposure to the AI megatrend – as you will see below, many of these stocks are now among the most widely held by individuals. It is no surprise that at this exact moment, the Magnificent 8 category, which confidently outperformed the whole market in the last two years, is finally lagging behind.
It should be noted that retail investors are not always wrong; in fact, you can frequently find quite promising high-growth names among those preferred by individuals. This category of investors often flocks together on social media platforms and actively shares knowledge with each other, meaning that the latest technological breakthroughs and inventions are already in their sights. In the current market, with uncertainties and fear looming from all directions (recall the tariff wars expected in April, large public spending cuts, layoffs, and Medicare/Medicaid threats), the “smart money” has been very cautious with US stocks. In fact, there has been a noticeable rotation of money from US stocks to the less overvalued foreign markets, like Germany and China, which have been using stimulus to fuel growth. With the US market becoming less favored by institutional investors, retail investors could enter the spotlight again and decide who the major winners will be.
This is particularly relevant as the modern investing philosophy has slowly drifted away from the rigid value-investing approach, which favors cheap, undervalued stocks, toward a preference for higher-growth stocks, which depend on momentum and often trade at high valuations for prolonged periods. The key takeaway for readers is that market winners are often not the cheap and undervalued stocks, but the stocks that gain the spotlight and become a magnet for money.
A development team working together to create the next version of Windows.
Our Methodology
For this article, we used the Robinhood Investor Index (which shows the most popular stocks on the investing platform Robinhood) and the Yahoo Finance Most Active Stocks screener to find a list of stocks most widely held by individual investors. We then compare the list with our proprietary database of hedge funds’ ownership, as of Q4 2024 and include in the article the top 12 stocks with the largest number of hedge funds that own the stock.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
Microsoft Corporation (NASDAQ:MSFT)
Number of Hedge Fund Holders: 317
Microsoft Corporation (NASDAQ:MSFT) is a global technology company specializing in software, cloud computing, AI, and hardware. Its core products include Windows operating systems, Microsoft Office productivity suite, and Azure cloud services, which support enterprise computing, AI, and data analytics. MSFT also owns LinkedIn, GitHub, and Xbox, expanding its presence in social networking, software development, and gaming. The technology giant ranked ninth on our recent list of 10 Companies That Are Buying Back Their Stock in 2025.
Microsoft Corporation (NASDAQ:MSFT) delivered a strong performance in fiscal Q2, with bookings growing 75% in constant currency, driven by significant Azure AI contracts. AI-related revenue, primarily generated from inference, post-training workloads, and Copilot services, reached $13 billion. The company is currently facing capacity constraints in AI infrastructure but expects supply and demand to stabilize by the end of the fiscal year. To support long-term growth, MSFT is making substantial investments in data center expansion, ensuring a scalable global infrastructure for both AI and commercial cloud workloads. The adoption of Microsoft 365 Copilot has exceeded expectations, with early customers expanding usage by purchasing additional seats, highlighting the strong demand for AI-powered productivity tools.
Microsoft Corporation’s (NASDAQ:MSFT) AI platform continues to gain traction, with over 1,800 models running through Azure marketplaces. The company’s partnership with OpenAI remains strategically vital, with commitments extending through 2030. While there have been some execution challenges in non-AI workloads, MSFT remains focused on both cloud migration and AI transformation. Additionally, the company is seeing better-than-expected margins heading into fiscal 2025, driven by AI-driven productivity improvements and optimization across its portfolio. As MSFT continues to expand its AI and cloud capabilities, it remains well-positioned to capitalize on the growing demand for intelligent computing solutions. Besides 317 hedge funds owning the stock, MSFT is also one of the most widely held stocks by individuals.
Overall MSFT ranks 2nd on our list of the 12 most widely held stocks by individuals in 2025. While we acknowledge the potential of MSFT as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than MSFT but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
