In this article, we discuss the 10 stocks Reddit’s WallStreetBets is now targeting. If you want to skip our detailed analysis of these stocks, go directly to Beyond GameStop: Reddit’s WallStreetBets is Now Targeting These 5 Stocks.
Retail investors have been exercising ever greater influence on the overall market dynamics the past few months, as the record stock rallies of GameStop Corp. (NYSE: GME) and AMC Entertainment Holdings, Inc. (NYSE: AMC) have demonstrated. However, as their influence increases, so does the list of stocks that gain from this influence. The most popular platform where these retail investors exchange ideas is the Reddit forum WallStreetBets. The forum has more than 10.6 million members and is one of the hottest online places in finance.
Some of the stocks presently popular on WallStreetBets include Alibaba Group Holding Limited (NYSE: BABA), Virgin Galactic Holdings, Inc. (NYSE: SPCE), and MicroVision, Inc. (NASDAQ: MVIS). Interestingly, the theory that stocks increase in value along with the number of mentions on this forum has been steadily gaining traction. In June, Financial Times reported that hedge funds were keeping track of stock mentions on Reddit after record losses in the GameStop Corp. (NYSE: GME) and AMC Entertainment Holdings, Inc. (NYSE: AMC) short squeeze.
One reason why institutional investors are monitoring these forums is the meme stocks – firms with little to offer in terms of earnings or growth but rally on the back of retail investor interest – that are often the subject of short-selling attempts. As retail investors initiate short squeezes, there is a danger of repeating the mistakes made during the GameStop Corp. (NYSE: GME) and AMC Entertainment Holdings, Inc. (NYSE: AMC) saga in January that led to billions of dollars in losses to big finance and even led to the closure of some hedge funds.
Decline in Meme Stocks
Even though retail investors have had the upper hand in this meme stock battle with hedge funds, there are early signs of these meme stocks running out of steam. News agency Reuters reports that GameStop Corp. (NYSE: GME) and AMC Entertainment Holdings, Inc. (NYSE: AMC) have both fallen to half their peak value reached early last month. Both stocks have registered four straight days of losses. GameStop Corp. (NYSE: GME) is now trading at $167 while AMC Entertainment Holdings, Inc. (NYSE: AMC) was around $33, compared to June highs of $344 and $72.
In recent weeks, there has also been increased interest around other internet platforms where retail investors gather to exchange ideas, like StockTwits and Robinhood. The former is a social media platform for stock traders and the latter is a trading application that is poised to go public at a $40 billion valuation soon. Adding fuel to this drop in popularity of WallStreetBets forum is that it has gone private, with moderators now…
Read More: Reddit’s WallStreetBets is Now Targeting These 10 Stocks