meme stocks

Meme Stocks

Part of a series on WallStreetBets GameStop Short Squeeze. [View Related Entries]

Updated Jun 28, 2022 at 11:33AM EDT by Zach.

Added Nov 04, 2021 at 05:59PM EDT by Brandon.

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About

Meme Stocks is a slang term that refers to stocks that see a notable increase in trading volume due to attention and virality on social media rather than a company’s performance, financial position or other more traditional factors. Stocks that make up $BANG, such as Blackberry, AMC, Nokia and GameStop, are among the most well-known examples of meme stocks due to the massive amount of memes and discussions revolved around them online. The term came about during the WallStreetBets GameStop Short Squeeze in early 2021.

Origin

While "meme stock" was used colloquially in memes beforehand, on January 26th, 2021, Marker,[1] a subsidiary of Medium, was the first to put the word combination into print during the WallStreetBets GameStop Short Squeeze that began earlier that month. The article written by James Surowiecki talks about how these examples of meme stocks, which include Hertz and Kodak in 2019, share similarities, such as having a failing business model with little hype or new market-moving additions but being heavily discussed and referenced in jokes among online social groups, such as Reddit.

As the GME short squeeze continued trending online into February 2021, mainstream news sources began to cover the story and other meme stocks, with CBS News[2] covering the topic on February 1st, 2021. In the article, Khristopher J. Brooks explicitly named AMC, Nokia, and WallStreetBets in the headline of the piece. Bloomberg Wealth[3] was the next one to mention meme stocks, but this time in a more negative connotation as February 2nd was when GME stock deflated by over 50 percent of its value.

Spread

The term and concept of meme stocks continued to spread in early 2021 alongside the GME short squeeze, which was massively viral across multiple platforms at the time. Many people on social media in January that year shared memes discussing GameStop stock, which also added to the term. For example, on January 28th, the meme website ahseeit[4] featured an upload of the Left Exit 12 Off-Ramp meme that used meme stocks as the example of what to do instead of investing in blue-chip stocks (shown below).


LEFT EXIT 12 BLUE МЕМЕ CHIP STOCKS STOCKS EAST EVERYONE

On February 26th, 2021, Sir John Hargrave posted on his Medium[5] blog about investing in the new "memeconomy" and provided an infographic on how the process works (shown below).


How Meme Stocks Work Joke investors Real investors THAT ESCALATED QUICKLY pile on pile on Ray of hope MEME FUEL Joke Slope of ignorance (or enlightenment) MEME FUEL "Let's all MEME FUEL МЕМE MEME FUEL invest in Trough of disillusionment TRIGGER becomes this thing as a joke" real

On June 9th, 2021, Reddit[6] user pettyblake uploaded a screenshot of their Instagram feed, which included a definition and warning for meme stocks that was a sponsored advertisement post by MintApp, a financial application. According to MintApp, meme stocks are overvalued purely based off social media hype and not company potential and suffer from artificial price hikes (shown below).


12:03 LTE O Instagram +) View all 512 comments Add a comment... 22 hours ago mintapp Sponsored Meme Stock A stock that has seen an increase in volume ecause of hype on social media and online forums instead of the company's performance. These stocks are extremely volatile and can often become overvalued due to artificial price hikes. #WTFinance 4,016 likes mintapp What do $AMC, $GME, and $BB have in common? They're all considered 'meme stocks.' Here's more background on the term. #WTFinance View all 72 comments Q

Various Examples


GameStop But my financial advisor says meme stocks are dangerous! |(5.91%) + |(41.22%) + (87.11%) + |(17.64%) + Come on! Does this look dangerous to you? Me trying to blend in while Everyone is talking about Stocks, Diamond Hands, Tendies, and Crynto Curenies me @thebarbershop.talk I wouldn't tell anyone; Amc hedgis losť but there will be hints ruchan. nch TM Redditors: Invests in Gamestop after hedge funds begin shorting its prices Wall Street Guys: You.little monster,0 thought you were masturbating LOOKING GOOD, AMC! FEELING GOOD, STONKS!

Search Interest

External References

[1] Marker – Gamestop Fiasco

[2] CBS News – AMC, Nokia, WallStreetBets

[3] Bloomberg Wealth – Meme Stocks Lose

[4] ahseeit – meme stocks

[5] Medium – Sir John Hargrave

[6] Reddit – r/stonks

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