This is where small investors discuss stocks: the logo of the Reddit group Wall Street Bets. SOPA Images / Getty Images
The resurgence of meme stocks suggests that individual investors are looking to take on more risk again.
AMC Entertainment, GameStop and Bed Bath & Beyond stocks have outperformed the S&P 500 over the past few weeks.
All three companies were among the top-traded stocks on Fidelity on Monday, suggesting retail investors are fueling the boom.
Meme stocks have taken a big hit over the past few weeks, as shares of AMC Entertainment, GameStop, and Bed Bath & Beyond have outperformed the broader stock market.
Since the S&P 500 bottomed on June 17, AMC Entertainment, Bed Bath & Beyond and GameStop are up 118 percent, 88 percent and 44 percent, respectively. Meanwhile, the S&P 500 is up just 15 percent. On Monday, shares in the three companies rose at least 10 percent and as much as 40 percent, pointing to the possibility of retail investor-driven risk-taking.
Living only on dividends at 45: David Frank in the Money Mindset Podcast
Gamestop was among the ten most traded stocks on Fidelity on Monday
Retail investors are making a comeback as the broader market gains traction despite mounting fears of an economic slowdown. On the Wallstreetbets forum on social platform Reddit, GameStop, AMC Entertainment and Bed Bath & Beyond were among the top 10 most talked about stocks Monday, according to data from SwaggyStocks.
Data from Fidelity shows that AMC Entertainment was the most traded stock on the platform as of Monday, with more than 6,000 buy orders. AMC’s recovery has also been helped by several successes this summer and the company’s recent decision to issue preferred stock dividends to its investors. GameStop and Bed Bath & Beyond were also among US broker Fidelity’s ten most traded stocks on Monday.
Companies face these problems
Whether the rally in mem stocks is sustainable remains to be seen. Nvidia issued a profit warning Monday, saying expected revenue for the quarter will fall by more than $1 billion as gaming market weakness continues. That could be bad news for video game retailer GameStop.
Bed Bath & Beyond recently reshuffled management following a sharp drop in the company’s quarterly results, and uncertainty remains at AMC as the box office has yet to fully recover from the COVID-19 pandemic. Despite the risks, individual investors are willing to take another bet on meme stocks if their share prices rise.
This text was translated from English by Lisa Ramos-Dosse. You can find the original here.
Financial expert Gerd Comer reveals: This is how I invest my money privately