What Are Meme Stocks, and Are They Real Investments?

The highest Nokia stock value was recorded in June 2000 – approximately $58 per share. GameStop is a popular video game retailer that was founded in Texas in 1984. Representing heaven on earth for every gamer, GameStop is a one-stop shop for all your gaming necessities. From the widest range of video games to all kinds of consoles and gaming accessories, GameStop offers its products to customers not only in more than 4,500 physical stores but on their online platform as well. Another important transaction was the one between Tesla and Hertz – a vehicle rental firm.

People rallying to buy AMC Entertainment shares allowed the company to raise more than $2 billion, which automatically made its Reddit meme stocks among the best ones. GameStop Reddit meme stocks became part of the New York Stock Exchange in 2002. The price of the shares remained below $25 until 2017 when the company gained a sudden increase in the following. Naturally, such events affected the shares, which were trading at $17 in early 2021.

The Commodities Futures Trading Commission is conducting a similar investigation regarding the prices of silver futures. When it comes to Reddit meme stocks, Virgin Galactic offers its own meme stocks which became increasingly popular throughout 2020. From their initial price of $12 in January 2020 to $44 only several weeks later, it’s safe to say the company’s meme stocks had a successful launch. The stock price skyrocketed from $12 to $59 within a couple of weeks.

• It’s going to take years for Virgin Galactic to experience its true “lift off” moment.
• But daily counts that routinely total in the hundreds and upvotes in the thousands mean that a discussion of best meme stocks wouldn’t be complete without GME stock.
• Adam received his master’s in economics from The New School for Social Research and his Ph.D. from the University of Wisconsin-Madison in sociology.
• He noted that while most will fail or at least “dramatically underperform,” “somewhere in this barrage of moonshots there will almost certainly be a few huge winners that leverage disruptive technology.”

You might want to start your search here, but there are other options if they don’t meet your needs. During this period, its stock shares skyrocketed 12%, and it’s seen a 100% overall increase in share price over the last six months. There are many reasons why NVIDIA stock could continue to perform well within the next five years.

Nevertheless, the https://1investing.in/ offers so much more than the largest movie theater chain in the world. Energy is such a pervasive resource that it affects every single human endeavor. Energy has become fundamental to the very basic functions of contemporary civilization.

What is a meme stock?

Right now, Snap Reddit meme stocks are 64% lower than their record high, largely due to the latest privacy updates made by Apple. However, Snap is working hard to integrate AR technology into its platforms, which is why now’s the perfect time to invest in these top Reddit meme stocks. The first one of the ten Reddit meme stocks on this list is Tamadoge. This isn’t only the first but also the best investment opportunity out of all of them. Although not technically a stock, Tamadoge is a meme crypto asset that outperformed all top Reddit meme stocks currently out there. Just like any other stock market, the Reddit meme stock market is highly volatile.

Fueling the behavior are discount brokerages now offering commission-free trading; technology that is making it easier to transact from anywhere on a mobile phone; and a pandemic that has caused a spike in day-trading. When millions of individual stock pickers took on Wall Street— leading transaction volumes to surge in January—some didn’t see it coming. Now that the new generation of traders is driving so much of today’s equity flows, established industry players are asking what their participation means over the long haul.

How to identify a good long-term meme stock

If many shorts are forced to cover at once, it adds additional upward pressure on the stock’s price as they are all forced to buy the stock and cover at ever higher prices. This is known as a short squeeze, and it accelerates a stock’s price increases as more and more short sellers are forced to bail out to cut their losses. One of the primary reasons for the rise of meme stocks was the resentment most people felt toward corporate America in light of the COVID-19 pandemic and rampant inflation. However, the performance of these stocks soon became another factor that increased their popularity. According to an Acuitas Investments report from September 2021, meme stocks outperformed traditional stocks by a significant margin in that year.

Despite blue wave election results, U.S. pot legalization failed to happen in 2021. The chances of federal pot reforms still appear questionable for 2022 too. With this, plus a recent report from Barclays arguing that there’s not much upside for Canadian cannabis companies from U.S. pot reform, Tilray stock has continued to draft lower. Even if the data allegation brouhaha finally goes away, SAVA stock will likely experience another massive drop, if the FDA rejects Simulfilam for FDA approval. Nevertheless, with the big potential for it to bounce back in 2022, keep an eye on it. As I discussed back in October, prospects look bright in terms of steel demand in 2022.

The good news is that meme stocks come from all nooks and crannies of the stock market, so it’s possible to build a diversified portfolio of holdings that can catch a tailwind from various places. Some meme stocks don’t trade on any fundamentals, and returns can suddenly reverse course, causing the company to lose its luster among individual investors. As with other moments of viral skyrocketing stock prices, the meme stock trend may not last forever — especially as some traders return to work and spend more time away from home.

In the first two pre-using the price-to-earnings ratio and peg to assess a stock months of 2020, the total number of shares transacted across U.S. equities exchanges held steady at between 7.8 billion and 8.3 billion, according to Cboe. Then, in March 2020, both the number of shares transacted and the trade volume surged. But even as valuations began to sharply recover, activity was consistently north of 10 billion shares traded daily. Moreover, the retail participation is much broader than initially reported, according to market participants. The activity has already targeted dozens of stocks across multiple sectors. It involves large numbers of retail investors who have opened zero-commission brokerage accounts.

Meme Stocks: Cassava Sciences (SAVA)

Only a small number of these have been approved for trading so far, but do include some meme stocks like Tesla and NVIDIA. With the advent of the internet, memes began to take the form of humorous social media posts and viral videos. Meme stocks are so-named because ideas about them, too, spread rapidly online on social media and web forums. Meme stocks also see communities built around them that perpetuate the hype and elaborate on the original meme, inventing specific terminology and symbols to accompany the stock.

Retail traders tend to turn struggling companies into meme stocks, so it is less likely that they would have strong enough financials. Read about how to find high-yielding dividend stocks in the market. Out of these five listed meme stocks, Nokia has the current largest market capitalisation and global presence, operating in over 130 countries worldwide. Therefore, some investors may see Nokia not simply as a meme stock but as a company with long-term investment potential, dividing investor sentiment​.

Lately, it has spread even to cryptocurrencies, as evidenced by the interest surrounding Coinbase Global, a cryptocurrency exchange, which conducted a direct listing in April. In this article, we will be taking a look at the 11 best meme stocks to buy now. To skip our detailed analysis of these stocks and their past performance, you can go directly to see the 5 Best Meme Stocks to Buy Now. That’s because for a meme stock to actually take off, it needs the rocket fuel from the Reddit crowd.

Even so, while it’s gone from $10 to $50, and back to $10 and below, now may be a great time to initiate a position. Some meme stocks did not fare as well as others, even with the occasional short squeeze. Other meme names have included, among others, Bed Bath & Beyond Inc. , Koss Corp. , Vinco Ventures , Support.com, and even the meme stock enabler Robinhood Markets Inc. .

Many hedge funds were short GameStop — Melvin Capital Management, most transparently — but once the potential to execute a short squeeze in the position became widely known, institutional money flooded into GME too. Participation is not concentrated solely in the 15 or so headline-grabbing names that initially dominated the coverage. It has evolved to cover at least 50 names, based on the number of companies in which online brokerage Robinhood Markets restricted trading on January 29 at the height of the meme stock mania. The trend started last year, with the onset of COVID-19 creating a larger population of day traders, who could buy and sell from their mobile phones, trade algorithmically, or even use large amounts of borrowed money. Retail flow has played a large part in driving the price action in U.S. equities ever since, although participation has been outsized since the middle of 2020.

Meme stocks can be effective for traders who prefer to speculate on more volatile markets. However, they can also bring many risks, so consult our guide on trading risk-management protocols before opening a position. “The retail force behind this movement is still strong, so it is anyone’s guess how much larger this bubble can grow.” Other resurgent meme stocks embroiled in the latest frenzy include Beyond Meat and Koss Corporation, which have soared nearly 40% apiece in recent weeks. The eye-popping gains have inspired legions of hopeful successors to the original meme stocks, and sifting through the noise of online stock manipulation has never been harder.

Invest in stocks, options, and ETFs at your pace and commission-free. However, a number of these are not blue-chip stocks, like Facebook, which could indicate financial instability, vulnerability to fluctuations, and unclear long-term potential. The famous chipmaker NVIDIA was one of the companies that became a topic of conversation among investors on Reddit, especially after its excellent financial performance in the third quarter of 2021. A member of the hot 2020 IPO stock class, Palantir quickly gained a large investor following after making its public debut.

Squeezes are business and investing situations when borrowing is difficult or when profits decline due to increasing costs or decreasing revenues. Chip Stapleton is a Series 7 and Series 66 license holder, CFA Level 1 exam holder, and currently holds a Life, Accident, and Health License in Indiana. He has 8 years experience in finance, from financial planning and wealth management to corporate finance and FP&A.