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Simplify Asset Management chief strategist Michael Green sits down with Julie Hyman and Josh Lipton on Market Domination Overtime to discuss the divergence between retail and institutional investors’ expectations for the market (^DJI, ^IXIC, ^GSPC).

Goldman Sachs strategists project the S&P 500's (^GSPC) annual nominal return will slow to 3% over the next decade. While some on Wall Street are sounding the alarm that growth will slow, others are less concerned.

“If you look at the retail perspective, they're absolutely putting money to work. Vanguard conducts a really interesting survey of their investors, asking them what their long-term expectations for equity returns are," Green says. "Those have actually started to rise even as Goldman Sachs and frankly, Vanguard itself, their strategists are actually projecting 3 to 4% returns out of US equities going forward, well below the averages.”

Yet, retail investors have “grown accustomed to watching their portfolios rise as rapidly as they have, are now starting to bake in 8%, 9%, 10% sort of returns into their expectations that, ironically, are actually hitting like the 95th percentile possible outcomes that the strategists are calling for at the same firms.”

Green finds a "wide divergence" to be forming between these two group's stock market expectations: "At the end of the day, it's people with money that rule, though. So if they're going to continue to pile that money in, if they're going to continue to put it to work, you'll see days like today where things are pushed up."

To watch more expert insights and analysis on the latest market action, check out more Market Domination Overtime here.

This post was written by Naomi Buchanan.