Meme stocks are stocks that aren’t grown naturally, rather skyrocket the price of the share from the use of social media and Reddit.com. Redditors, who call themselves “Apes” have built their own trading community fueled by hype.
Now it seems Reddit users have a few new targets, today as one meme stock CLOV (Clover Health Investments Corp) soared. The market opened Monday with CLOV shares under $10, and closed Tuesday up 85% with shares at $22.15. After hours market value continued to increase as of late Tuesday evening.
The popular forum r/CLOV increased momentum in this short squeeze meme fueled stock frenzy.
r/wallstreetbets also played a role in today’s CLOV increase. The image below, taken from wallstreetbets, shows “Times Memed” with “CLOV” ranking highest at 913 as of 7:17am, June 8th.
‘Meme’ stocks might be a temporary and short-lived artificial inflation of a stock beyond its actual value, but it has gained rapid popularity since the first GameStop surge. Now involving more companies like Blackberry, Nokia, Virgin Galactic Holdings, and Wendy’s.
The rise of GameStop (GME) started the trend. AMC has begun to follow as of 2021. AMC shares have increased at an astonishing rate.
The Reddit forum r/AMCStock suggested that shares will continue to increase from their current standing value of $55.05 at today’s close. Many with shares, continue to “HODL” or hold their shares, in hopes of seeing an increase as high as “$1000 a share” and continue to grow “to the moon!” Just a little over a month ago the AMC share price was below $10.
Critics believe the new wave of meme stocks may have allegedly emerged as a distraction from bigger stocks like AMC, and GME. Some suggest the new emergences may be propagated by the hedge funds themselves to cover their losses. These may be just speculations, but even speculations increases the online presence, and popularity of this meme stock trend.
These are indeed exciting and interesting times for the meme stock traders involved. Even people without shares, are speculating the outcome of the rise and fall of the modern short squeeze. It is a historic risk more and more people seem to be wanting to be a part of. There seems to be a sense of community in the Reddit forums.