What are meme stocks

To do so, you’ll need to select a provider, choose the type of account you’d like to open and provide some personal details. Many of the most popular providers allow users to open and manage their account online or via an app. To help support our reporting work, and to continue our ability to provide this content for free to our readers, we receive payment from the companies that advertise on the Forbes Advisor site. Impact on your credit may vary, as credit scores are independently determined by credit bureaus based on a number of factors including the financial decisions you make with other financial services organizations. Get a custom financial plan and unlimited access to a Certified Financial Planner™ for just $49/month. “Over time, just like offense and defense, offense slowly learns what defense doing,” Rehl said, with the “defense” the team of subreddit moderators tasked with keeping forums clean.

Known as “meme stocks”, they are shares that gain viral popularity with large numbers of investors through social media. Believing they could drive the value of the stocks higher by squeezing those short positions, Gill outlined a path in an August 2020 YouTube video that could send GameStop shares from $5 each to $50 or above. Gill and activist investor Ryan Cohen were key figures in motivating a community of online traders from the WallStreetBets subreddit to buy and hold shares of GameStop, running up their price.

Prices rose 11.27% in the month to 16 May, topping $4 before settling back to around £3.90. Part of the meme stock’s appeal is the opportunity to battle such institutional short-sellers by backing what’s perceived as a plucky underdog. However, there seems to be little connection between a company’s meme stock status and its actual performance or prospects. While the number of NOK shares sold short has fallen substantially, many  meme-stock investors are still interested in the firm . If many institutional investors short Nokia again, NOK will certainly be a stock to keep an eye on.

1. Despite no shortage of headlines about the economic reopening, generous fiscal stimulus packages, and the Federal Reserve’s monetary policy, meme stocks have stolen the spotlight in the investing world this year.
2. The shares later pared some of their gains, though they remained up about 6% late Friday afternoon.
3. Then again, interest expenses totaled 5.6% of net sales in the first quarter, up from just 1.1% of total sales in the first quarter of 2019.
4. While GameStop was the first successful meme stock, it was not the only one.
5. GameStop’s stock price has gained 179% over the past two sessions, though at $48.75 it’s still well below its record of more than $85 in January 2021.
6. Meme stocks are largely companies with brands that are recognizable to some degree to individual investors, compared with other stocks that may not have as much resonance with regular investors.

The Motley Fool reaches millions of people every month through our premium investing solutions, free guidance and market analysis on Fool.com, top-rated podcasts, and non-profit The Motley Fool Foundation. In January 2021, WSB mobilised its members to invest enough to raise the price of GameStop from US$17.25 (£13.17) to US$500 (£381.85) per share. Wall Street hedge funds which had bet against price of the stock lost billions.

The other notable factor is the combination of short interest and short ratio (also known as “days to cover”). As of May 28, Blink had nearly 12.5 million shares held short and a float of 35.9 million shares. how to use currency pairs correlation in forex trading More importantly, Blink Charging has seen just shy of 3.5 million shares trade hands daily over the past three months.

Nokia Oyj’s 5-Year Share Price Performance

The incredible surge of GME stock last year, which took its shares from around $4 in mid-2020 to more than $480 per share in January 2021, was one of the most incredible near-term short squeezes I’ve ever seen. AMC’s value is currently lower than it was before the rise of meme stocks in 2021. But lesser-known investing subreddits can be plagued by manipulators like spammers and bots.

Meme Stocks: What They Are and 5 Top Stocks for September 2024

So if you sell the stock you borrowed for $10, and then its price rises to $50, you’re responsible for those shares, meaning you’re on the hook for that $40 you owe the broker. 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. Despite no shortage of headlines about the economic reopening, generous fiscal stimulus packages, and the Federal Reserve’s monetary policy, meme stocks have stolen the spotlight in the investing world this year. Similar to Blink, there are two reasons it’d make a perfect meme stock. First of all, retail traders are big fans of left-for-dead turnaround stocks in the wake of the pandemic. There were serious concerns last year that Dave & Buster’s might not survive.

Facing Reality: AMC Stock Is Headed for Brutality and Fatality

In recent years, the meme stock trade hasn’t reached the fever pitch that it did back in the winter of 2021. All of these same stocks that surged in value in the wake of the initial meme stock craze have fallen quite substantially in price from their peaks. GameStop, for example, reached a multiyear low near $10 per share in April 2024.

Meme stocks are company shares that develop a cult following of retail investors, typically built through online communities such as Reddit. That said, the number of retail investors who are interested in Microsoft and other mega-cap stocks is likely to increase meaningfully. That’s because, as stocks’ valuations come down, the share prices of many companies,  including Microsoft, have fallen meaningfully, making these names more attractive to many retail investors. When online investors understood the short positions against GameStop, people took it on as a Robin Hood-like adventure (often using the trading app Robinhood to do so).

‘Meme stock’ investors are trying to catch up with a financial system which has left them behind – new research

A meme stock refers to the shares of a company that have gained sussex advice firm being wound up following svs securities british steel debacle viral popularity due to heightened social sentiment. This social sentiment is usually due to activity online, particularly on social media platforms. These online communities can dedicate heavy research and resources toward a particular stock.

BlackBerry, the Canadian brand behind the popular 2000s smartphone, has been struggling for over a decade, progressively losing market share to Apple’s iPhone. AMC is a US-based cinema chain that approached bankruptcy in January 2021, having been hit by the coronavirus pandemic. As a brick-and-mortar retailer, GameStop had been beleaguered by the ongoing shift towards e-commerce, hastened by successive Covid-19 lockdowns.

The use of memes, which are tweaked images, videos, text, etc., is a central component of how the usually positive reviews of these stocks are copied and spread across the internet. Some of the more popular meme stocks, such as GameStop, continue to enjoy higher stock prices than before the short squeezes in 2021. Others, such as Streaming stocks AMC, are now even lower than their pre-pandemic values. After the GameStop incident, some hedge funds suffered significant financial losses, while some retail investors made millions. Other meme stocks emerged after GameStop, some with varying degrees of success. And of all the market rises and falls, one type of stock has become particularly volatile.

While the company hasn’t produced a phone since 2016, it continues to operate, instead providing cybersecurity and encryption services. On 13 May, Keith Gill – better known by his social media handle, Roaring Kitty – posted to X for the first time in three years. The former financial analyst is a YouTuber, livestreamer and Reddit user, whose backing of GameStop helped propel the share’s popularity. This company’s status as a 5G provider does give investors reason to be upbeat about its growth outlook. However, it was Nokia’s following on forums such as Reddit’s WallStreetBets which really galvanized many investors to pile into this name.

Each investment platform has a slightly different process, but you’ll typically need to type the name of your chosen company – or its stock market ticker symbol – into a search bar. Before you can buy and sell shares, you’ll need to open an account with a regulated investment platform. In May 2024, Nokia was one of a handful of meme stocks to be revivified by Keith Gill’s return to X (formerly Twitter).