Meme stocks are the ones that attract the attention of retail traders because of the hype surrounding them on online forums like Reddit, Twitter, and Robinhood that, regardless of their fundamentals, have increased in both volume and share prices. Thus, these stocks are considered to be highly speculative. Commission free and easy trading on apps has increased the retail business. This made up about 23% of total US equity trading per FT in 2021.
Reddit’s WallStreetBets forum became famous in early 2021 with the GameStop craze. Gamestop Corp. (GME) grew a lot then. We are currently seeing the same phenomenon repeat with GME stock up 50% over the past five days and up almost 30% on March 21st, 2022. So another Reddit favorite is the status quo of the struggling movie theater chain. AMC Entertainment Holdings, Inc. AMC, which has seen a 15% jump in shares on March 21. The stock gained 10.8% after hours on March 22.
According to a Business Insider article, Reddit’s WallStreetBets forum with more than 11 million members recently inspired conversation in the above meme shares. The article also pointed to the most mentioned shares on Reddit’s platform. They are: Tesla (TSLA), Alibaba (BABA), Advanced Micro Devices (AMD), ZIM Integrated Shipping Services (ZIM), Nvidia (NVDA), Boeing (BA), Apple (AAPL), Meta Platforms (FB) and Amazon (AMZN).
While such stocks can be played to tap mem stocks, there is a pure ETF called Roundhill MEME ETF (MEME) on the same concept. The underlying Selective Roundhill Mayme Stock Index comprises 25 equally-weighted US listed equity securities that exhibit a combination of elevated social media activity and high short interest. It charges 69 bps in fees.
then there isVanEck Vectors Social Sentiment ETF (BUZZ), which has 75 large cap stocks showing the highest level of positive investor sentiment. It uses AI to collect content from online sources including social media, news articles and blog posts.
There’s Yet Another ETF Advisory Shares Alpha DNA Equity Sentiment ETF SENT, which provides equity participation in bull market and downside protection through put option in case of bearish market.
Any other ETF options?
Here we recap our selection of Boeing (BA) in view of its latest 737-800 crash in China. We also exclude Alibaba and Facebook as both have Jax #5 (Strong Sell). But investors can play with other companies through the ETF route by placing a bigger bet on the fund than it is on the respective stock. In this regard, below we highlight five ETF areas that tapped into the latest Reddit craze.
information technology
Apple AAPL – Jax Rank #1 (strong buy); Surprise average earnings for the last 4 quarters: 20.28%
ETFs: Technology Select Sector SPDR Fund XLK
semiconductors
NVIDIA NVDA – Jacques Rank #2 (Buy); Surprise average earnings for the last 4 quarters: 7.04%
Advanced Micro Devices AMD – Jax Rank #1; Surprise average earnings for the last 4 quarters: 17.03%
ETFs: VanEck Semiconductor ETF SMH
electric vehicles
Tesla TSLA – Jacques Rank #2; Surprise average earnings for the last 4 quarters: 33.26%
ETFsVCAR Simplify: Volt Robocar Disruption & Tech ETF
Shipping & Delivery
ZIM Integrated Shipping Services ZIM – Jax Rank #1; Surprise average earnings for the last 4 quarters: 22.67%
ETFs: SonicShares Global Shipping ETF BOAT
online retailing
heroine AMZN – Jacques Rank #3 (Hold); Average earnings surprise of last 4 quarters: 167.33%
ETFs: ProShares Online Retail ETF ONLN
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Amazon.com, Inc. (AMZN): Free Stock Analysis Report
Apple Inc. (AAPL): Free Stock Analysis Report
Visa Inc. (V): Free Stock Analysis Reports
MEDNAX, Inc. (MD): Free Stock Analysis Report
Technology Select Sector SPDR ETF (XLK): ETF Research Report
VanEck Semiconductor ETF (SMH): ETF Research Report
AMC Entertainment Holdings, Inc. (AMC): Free Stock Analysis Report
ProShares Online Retail ETF (ONLN): ETF Research Reports
Volt Robocar Disrupt and Simplify Tech ETF (VCAR): ETF Research Report
Advisory Shares Alpha DNA Equity Sentiment ETF (Submitted) : ETF Research Report
SonicShares Global Shipping ETF (BOAT): ETF Research Report
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Jax Investment Research
