Super Micro also offers data storage solutions and server management software. Having enjoyed massive growth over the past few years, expectations appear to be high. BlackBerry is well-known as once being a leading smartphone manufacturer with models sporting physical keyboards and secure communication. Having been eclipsed by the likes of Apple’s iPhone and Samsung, it has successfully transitioned into a software and services provider focused on cybersecurity and the Internet of Things. I became a self-made millionaire by the age of 21, trading thousands of Penny Stocks – yep you read that right, Penny Stocks.
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Even GameStop can’t be the next GameStop stock with just a 16.95% short interest repeating what happened at the dawn of the meme stock bubble. The next GameStop stock will have to have more than a 100% short interest. 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.
Note these may not be the best investments, and each data provider calculates trending shares using different methods. AMC’s stock closed Tuesday at $6.85 and has risen 135% since Friday, but it’s a far cry from its all-time highs above $300 set in June 2021. Currently, Nvidia dominates the data center market with over 85% of the market share. However, the opportunity for Advanced Micro Devices, at least in the short term, comes from the refresh cycle for central processing units (CPUs) and graphic processing units (GPUs). AMD has dominated trading systems these areas in the past and is likely to continue to show strength as the cycle refreshes.
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The stock market is in the thick of another meme stock frenzy, sparked by Sunday night’s online return of one of the key figures of the 2020 and 2021 craze that sent GameStop (GME) shares to record highs. If you’re not interested in building and managing your own portfolio of meme stocks but still want some exposure to the movement, there are some ETF solutions to help. One example is the VanEck Social Sentiment ETF (BUZZ -0.36%), an actively managed portfolio of 75 stocks that rank high in social media conversations.
How to trade meme stocks
You could also consider the company’s price-earnings (P/E) ratio – the market price of a share divided by the company’s earnings per share. This has since decreased – despite a small rally in May 2024 – to around $5.50. Gill made no mention of GameStop or any other company in his posts, but his reappearance on X – previously known at Twitter – was enough to spark fresh investment that saw GameStop’s price rise by over 74% in a single day. You should always check with the product provider to ensure that information provided is the most up to date.
- And with meme stocks, it can depend on why the stocks are catching traders’ attention.
- Individuals on popular social media sites like Reddit, X and Facebook now regularly discuss the class of shares known as meme stocks.
- Where a company’s fundamentals don’t support future share price gains, this could result in deepening your exposure to an asset of little value.
- Of course, many ordinary investors were drawn into the short squeeze by the idea of making a profit from driving up GME’s share price.
- The social media world has given a much greater voice and larger platform to the average investor, who doesn’t have as many resources as a hedge fund for example.
Loser
In the ensuing months and years, meme stocks have remained a focal point of financial markets, captivating a diverse audience of enthusiasts and skeptics alike. Today, they continue to challenge traditional notions of investment and redefine the boundaries of retail participation in the stock market. The information provided by Forbes Advisor is general in nature and for educational purposes only. Any information provided does not consider the personal financial circumstances of readers, such as individual objectives, financial situation or needs. Forbes Advisor does not provide financial product advice and the information we provide is not intended to replace or be relied upon as independent financial advice.
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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. Lance Ippolito with Trading Pub shares 3 cheap stocks that could be your next explosive growth play. The company hired a new firm to handle its books and has since reclaimed the $30 mark, but the stock remains incredibly volatile. If AI stocks get another run in 2025, SMCI is a good bet to have a reignited uptrend. IG International Limited is licensed to conduct investment business and digital asset business by the Bermuda Monetary Authority. PayPal offers an online wallet solution what allows you to make and receive payments from companies and individuals without having to share your financial information, which adds a layer of security to the process.
History of Meme Stocks
Meme coins are inherently volatile, with their value often tied to cultural narratives, technological advancements, or real-world events. While this volatility can lead to significant returns, it also poses risks for investors. Understanding the factors driving meme coin popularity is essential for navigating this unpredictable market.
Looking to turn some of that extra free time into money, many people turned to the stock market and social media for ideas. While it is possible to make money with meme stocks, it is an extremely risky venture. Meme stock investing relies on trying to time the market, which humans, even those professionally trained, are notoriously bad at. It also depends on knowing which stocks will pop and which won’t — which is essentially impossible. Part of the motivation behind the online support for certain meme stocks comes from hedge funds’ short positions in those companies.
- Meme investors have routinely purchased spy puts over the last few years as a way to potentially profit from a market crash.
- The company has not profited in its operating history since its launch in 2009.
- Carvana shares have already been in a short squeeze as shares rose as high as $57.19 and have rallied over 1,000% in 2023.
- However, as of June 2024, the central issue facing the company is its EV business.
- 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.
The meme coin market is experiencing a surge in popularity, with its market capitalization climbing by 3% this week, from $53.61 billion to $55.51 billion. This growth underscores the increasing interest in these speculative digital assets, driven by cultural narratives, technological advancements, and real-world events. In this article, we’ll explore the latest trends, innovations, and factors fueling the rise of meme coins. Of course, many ordinary investors were drawn into the short squeeze by the idea of making a profit from driving up GME’s share price. I believe meme stock investors should consider buying spy shares at the moment with a glass half full mentality.
Another reason for the initial meme stock trades may have been that interest rates were near record lows. Cash offered almost nothing in the way of a return, so trading stocks may have felt like a way to earn something, despite its high risk. But in 2024, interest rates are much higher and savers earn decent yields on the cash they hold. Investors may be looking ahead to potential rate cuts by the Federal Reserve, but those are far from a guarantee. The original meme stock, GameStop is one of the world’s largest video game retailers, selling video games, gaming consoles, accessories and collectible merchandise.
I say that because spy shares track the performance of the S&P 500, which is itself among the most stable investments that there are. However, meme stocks focus on highly volatile, speculative firms, not the 500 largest publicly listed firms in the U.S. It’s vital to control your emotions should you take a position in a social media meme stock. Remember, they are best for trading as underlying fundamentals tend to be weak, which causes bears to short the stock, resulting in high short interest. The more irrational it is, the more likely short-sellers get involved and the more potential it has to short squeeze. Hedge funds and experienced investors know these aren’t long-term stock picks, they’re a wave meant to be ridden and abandoned when volume dries up.