Anyone who’s invested in the stock market will remember the hype surrounding meme stocks that began last year. Well, the stocks seem to have regained popularity with a rising number of investors showing interest in meme stocks over the last two weeks. Capital.com has released data that shows the stocks rising significantly on its platform! So, is now a good time to invest?
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No longer a fad? Meme stocks are on the rise!
When they first rose in popularity, experts assumed that meme stocks would be another market fad. However, recent data from Capital.com shows that meme stocks are on the rise once again.
In fact, 59% more retail investors traded popular meme stock GameStop last week than the week before. Furthermore, AMC entertainment saw its trading volumes rise by 226% on the Capital.com platform last week. This reflects a two-week winning streak that coincides with AMC’s recent price rally. The popular stock saw a 45% price surge on Monday 28 March, and trading volumes surged by 447% on the same day.
An expert’s take…
According to David Jones, chief market strategist at Capital.com, this sudden rise in popularity proves that meme stocks aren’t just a fad. The strategist says, “Just when we thought that the meme stock fad was so 2021, the two old Stuarts- GameStop and AMC- are back with a Vengeance over the past couple of weeks. We’ve seen a significant interest amongst our clients in trading the stocks- after all, there is nothing like a change in price to attract readers, like moths to the flame.”
Jones goes on to reveal that GameStop’s stock price has doubled since 17 March, and AMC entertainment has also almost reached this level. However, at the beginning of the month, things were looking down for Gamestop. It was trading at its worst levels since May 2021, representing a drop of more than 80% since June last year.
Jones warns that the surge in price could lead to a dip and that traders should be careful when considering adding meme stocks to their portfolios. However, the analyst says that the volatility in the meme stock market proves that meme stocks have a long way to go before dying out.
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Are meme stocks a good investment for 2022?
As Jones says, market volatility is often followed by a price dip. Therefore, those who are late to the trend may not profit from investing in meme stocks. However, if you invest in the socks whilst the trend is still beginning, you could see some significant gains in your portfolio.
Despite being considered a fad when they first became popular, the excitement around meme stocks is yet to fade. As a result, meme stocks could be an excellent addition to your investment portfolio. Many of the companies behind meme stocks have plans for future projects that could expand their operations and lead to fantastic profits. For example, GameStop has plans for an NFT marketplace that would take its operations to a whole new audience.
Remember that any investment could put your capital at risk, so it’s always a good idea to keep on top of market news and conduct analysis before making any decisions.
