27
Jul

Hiltzik: A new crop of meme stocks arrives Los Angeles Times

Once online attention fades, trading volume drops, and prices often return to levels aligned with company fundamentals. Over the past three years, most meme stocks have seen their share prices stabilise at values far below their peak and much more closely aligned with their fundamentals. However, Pandora’s Box has been permanently opened — the pandemic, which saw millions of people stay at home, created the perfect environment to open up the stock market world to more investors. Our meme stocks list is created by analyzing social media discussions, particularly on platforms like Reddit and 4chan. We track mentions and sentiments about different stocks to identify which ones are gaining traction as meme stocks. This list is maintained in real-time, with updates every five minutes, to reflect the rapidly changing dynamics of the market.

MARKET ANALYSIS

Supporters view meme stock participation as offering legitimate opportunity alongside risk, suggesting that traders can capture genuine gains when properly timing their entries into these volatile securities3. GameStop stock is currently experiencing another surge, with shares doubling in value amid a renewed frenzy in the market for meme stocks. This surge marks a continuation of the recent trend, where GameStop and AMC Entertainment shares have seen remarkable increases in value, driven by retail investors and social media chatter.

  • A meme stock refers to a stock that experiences a sudden and significant increase in its price because of online social media hype and viral trends.
  • The rise of meme stocks shows how connected retail traders can influence prices on a global scale.
  • To stay updated, follow financial news outlets, watch stock market trends, monitor social media platforms and forums where meme stocks are discussed, and sign-up to monitor and receive alerts on meme stocks.
  • You can spot a meme stock when trading volume and price jump sharply without business news.
  • Both sides face uncertainty and rapid reversals typical of meme stock volatility.

Semiconductor giant Nvidia reports earnings next week, and all eyes are on the stock as the bellwether for the AI-fuelled surge in tech stocks. The S&P 500 is not a stock — it’s the most popular index in the world, tracking the 500 largest companies listed in the United States by market capitalisation. AMC has in the past diluted shareholders when it spikes in order to take advantage of the financial optionality created by meme volatility.

Meme stocks are still with us, offering dangerous temptations for unwary and novice investors

A key component of discussions includes famous imagery or video, overlayed with humorous wordplay. Determine the appropriate timing for entering and exiting meme stock positions. Set clear profit targets and stop-loss orders to protect your investments.

These trading psychology factors such as excitement, belonging, and rebellion, help explain why meme stocks thrive despite obvious risks. Tesla and Palantir deserve serious consideration because they’ve proven that meme appeal can coexist with legitimate growth stories. Both companies generate real profits while maintaining the cultural relevance that keeps retail investors engaged.

Plan your trading

  • This ideological battle between decentralized traders and centralized oversight could shape the next phase of the meme stock movement.
  • Even so, the retail chain and e-commerce business is still a fan favorite in the stock trading chatrooms and blogs.
  • Supporters view meme stock participation as offering legitimate opportunity alongside risk, suggesting that traders can capture genuine gains when properly timing their entries into these volatile securities3.
  • In this guide, we’ll break down how meme stocks work, what drives their wild swings, and what every trader should know before joining the next viral investing trend.
  • The meme stock era forced regulators and institutions to rethink crowd-driven market behavior.It highlighted the power of collective action and the importance of understanding online sentiment as a market force.
  • GameStop occupies a strange place in financial history—the stock that launched a thousand memes and destroyed a few hedge funds along the way.

Over the past couple of years, users have become more fragmented across different platforms as other social media sites such as Telegram and Twitter have become more involved in the investment space. New websites have also emerged that enable users to monitor activity on social media without having to access the site. Our weekly digital publication of actionable swing setups, with a horizon spanning from days to months, driven by “FunTech”, our proprietary mix of Fundamentals and Technical Analysis. The traders who succeed in this environment are the ones who adapt faster than the market can price in their strategies.

Both can generate massive short-term gains for traders who time their entries and exits perfectly, but neither offers a compelling long-term story. They work best as small, short-term trades, not as part of a core investment strategy. It sparked interest among young investors, pushing them to learn about trading psychology factors, risk, and strategy, skills that can serve beyond the next viral trade. Short selling happens when traders sell borrowed shares, expecting the price to fall so they can buy them back cheaper. convert currencies If the price rises instead, short sellers lose money and may need to close positions. Covering these shorts adds buying pressure and pushes prices up even more.

Robinhood has turned retail trading addiction into a diversified fintech business model. After seeing some investors bragging on Wall Street Bets about getting winning trading advice from ChatGPT, we decided to test the AI’s knowledge of the market’s speculative frenzy. Pulitzer Prize-winning journalist Michael Hiltzik has written for the Los Angeles Times for more than 40 years. His business column appears in print every Sunday and Wednesday, and occasionally on other days.

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71% of retail client accounts lose money when trading CFDs, with this investment provider. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how this product works, and whether you can afford to take the high risk of losing your money. Third, short interest in some of these legacy meme names remained elevated, setting the stage for another classic short squeeze. With hedge funds and institutional players still betting against fundamentally weak companies, retail traders saw an opportunity to repeat the playbook of squeezing short sellers and capitalizing on volatility. The rise of meme stocks shows how connected retail traders can influence prices on a global scale.

Trending in Investment

Although the date has not been confirmed yet, GameStop is expected to release its Q3 results in early December. According to Koyfin data, it is projected to report EPS of $0.20 on $987 million in revenue, marking year-on-year gains of 230% and 15% respectively. Prices rarely reflect actual company performance, so predicting direction becomes nearly impossible. This sense of unity fuels participation and reinforces trading psychology factors tied to confidence and identity.

Managing Risk and Profits

A market analyst and member of the Research Team for the Arab region at XS.com, with diplomas in business management and market economics. Since 2006, she has specialized in technical, fundamental, and economic analysis of financial markets. Known for her economic reports and analyses, she covers financial assets, market news, and company evaluations. She has managed finance departments in brokerage firms, supervised master’s theses, and developed professional analysis tools.

Platforms now offer fractional options, community tools, and embedded education features. Finfluencers, live streamers, and YouTube analysts provide constant market commentary, making meme stock movements feel like participatory entertainment more than passive investing. This democratized information flow creates a feedback loop of hype, volatility, and action. You can spot a meme stock when trading volume and price jump sharply without business news.

Both sides face uncertainty and rapid reversals typical of meme stock volatility. Online communities create a sense of unity and shared purpose, giving retail investors a platform to exchange insights and challenge institutional narratives. The meme stock era forced regulators and institutions to rethink crowd-driven market behavior.It highlighted the power of collective action and the importance of understanding online sentiment as a market force.

DJT represents everything absurd about modern markets condensed into a single ticker symbol. Truth Social generates less than $5 million in annual revenue while the company trades at a $5 billion enterprise value—a disconnect so extreme it makes GameStop’s 2021 peak look reasonable by comparison. The stock had surged by more than 1,400% in the four days through Oct. 22, when shares hit an intraday peak of $7.69, up from a low of 50 cents on Oct. 16. More recently, the stock has slumped about 37% from the 52-week high of $35.81 it hit in late May.

It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. Forums such as r/wallstreetbets now boasts 16 million members (though far fewer are active), and many retail investors are still turning to social media to inform their investment decisions. If you spot a stock with 25% short interest and growing Reddit mentions, it’s worth monitoring. If that same company announces a partnership or beats earnings while social sentiment is positive, you might have found your next multi-bagger.