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Welcome to our guide to meme stocks. Here at CAPEX, we’ll discuss the meme stock meaning, give you examples of meme stocks, and even let you buy CFDs in meme stocks!
Meme stocks are stocks in companies that have enjoyed unexpected price rises that are largely driven by hype rather than logic, and have been the reason for many people to learn how to buy shares online. As such, meme stocks are volatile and risky investments. Recent meme stock examples include the likes of GameStop, BlackBerry and AMC Entertainment. Such brands’ stocks became meme stocks as a result of activity on social media channels such as Twitter and Reddit. The value of these stocks have risen and fallen dramatically following the viral activity on social media, and plenty of plenty will have earned and lost a lot of money through investing in meme stocks.
We at CAPEX will give you the information you need to make a smart decision about investing in meme stocks, as well as any other instrument you can trade through CFDs. When you open an account at CAPEX, you get access to our online trading academy. Please have a look at some of the lessons that we have available for you.
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While meme stocks are risky, they can be powerful short-term investments. We at CAPEX let you trade on the value of meme stocks through our CFDs. This means that you can ‘buy’ and ‘sell’ without having to actually own the underlying asset. As such you will be able to make the choice to trade very quickly which is something hugely important to high volatility assets like meme stocks.
After all, the value of these stocks can skyrocket or plunge in a very short space of time. So be sure to sign up to our site at CAPEX to take full advantage of the meme stock trend.
Meme stocks are stocks that achieve unexpected growth rates as a result of social media activity. Such growth rates are rarely based on the actual performance of the stocks, but are purely driven by hype. You won’t find the meme stocks meaning in any standard financial trading textbook, as this is a relatively new phenomenon that would have been unthinkable without social media.
Many meme stocks have gone viral through something of a David versus Goliath narrative. It’s common to detect a generational interplay in the rise of many meme stocks with tales of millennials and Gen-Z investors taking on more mature investors. While there’s a fair amount of irony in meme stocks, you can still invest in CFDs of meme stocks like you would any other asset right here at CAPEX. While it’s easy to be dismissive of meme stocks, they have become big financial news.
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Let’s have the meme stocks meaning explained through some examples. The biggest example of meme stocks investing in recent times was that of GameStop, which you can trade at CAPEX. This video game retail brand saw its stock value spike hundreds of dollars in just a few days in January 2021. A social media buying frenzy grew up around GameStop when some Reddit users learned that a hedge fund was shorting the brand’s stock. This essentially means that the hedge fund was betting that the stock’s value goes down between selling the stock and buying it later on.
The Reddit users sought to sabotage the hedge fund’s plans by buying up large amounts of GameStop stock. Such efforts went into overdrive when Tesla CEO stepped in to voice his opinion about the meme stock phenomenon. It’s important to note that the initial GameStop stock buying frenzy was just a spike, and meme stocks are a risky investment.
Meme stocks simply wouldn’t exist without the power of social media. The basic meme stocks meaning is inextricably linked with social media channels such as Twitter, Reddit and Stocktwits. These social media channels allow traders to discuss stocks and use their collective energies to generate what could be the next meme stock. Following the GameStop example, there were many more examples of meme stocks with the likes of Bed Bath & Beyond, AMC Entertainment and BlackBerry.
Many have also suggested that meme stocks have also come into play as a result of being able to use a commission free trading platform, such as ours at CAPEX.com, to easily trade those stocks. These have helped a new generation of investors take part in trading stocks in a way that was unthinkable just a couple of decades ago. As a result, stock market trading is now possible for a wider public and meme stocks are one of the by-products of this.
Now that we’ve established the meme stocks meaning we can see that these assets are capable of some astonishing growth in value. From the headline-grabbing GameStop to the likes of BlackBerry, there have been many people who’ve benefited from the growth of these stocks. Much of this has been down to doing research on the likes of WallStreetBets subReddit, as well as knowing when the current meme stock craze is going to pass.
Most meme stocks have a pretty short lifespan, and if you’re aware of the risks, then you could benefit from some impressive price rises. So check back into the CAPEX to see if Virgin Galactic Holdings or Dave & Buster’s could be the next big meme stock.
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A core part of the meme stocks meaning is the fact that the rapid growth of these stocks has no logical justification. Instead, a meme stock will come in as a result of little more than hype on social media sites. This means that once the hype has passed, the chances are that the value of the stock will plummet just as quickly as it grew in the first place. This was seen in the GameStop example where the value of the brand’s stock dropped 40% in 25 minutes not too long after it had experienced a staggering 2,500% growth.
As a result, we can see that meme stocks are highly volatile, and that other assets featured at CAPEX might offer more stability. Beyond our CFDs for some of the biggest meme stocks, you will find CFDs for some of the most durable dividend stocks, as well as top forex pairings, commodities and much more.
Now that we’ve established the meme stocks meaning, we can see that this is a unique investment opportunity. The concept of meme stocks wasn’t even here less than a decade ago, and it has become one of the defining features of online trading. While it’s easy to dismiss the social media-based hype around meme stocks, they are hugely powerful and many people will have successfully invested in these assets.
Despite this, you can’t get away from the core features of meme stocks which is that they are volatile and have no basis in the actual financial performance of the firm. As such, we’d express serious caution about buying meme stocks. But if you’re willing to take the risk, then sign up to CAPEX and see what CFDs are on offer for today’s biggest meme stocks.