Meme stocks rally shock Wall Street in 2021

Mooers Radar wrote a column · Dec 27, 2021 12:09

This year's activity coincided with a surge of rookie investors who joined the world of stock trading to ride the historic market rebound. Remote work, stimulus checksandhigher personal savings levels,as well as social media chatrooms only accelerated the boom in retail trading.

The meme stock saga started just days into 2021 when retail traders teamed up on Reddit's WallStreetBets' forum, aiming to bid up $GameStop (GME.US)$'s shares, which were heavily shorted by hedge funds. The retail buying triggered massive short covering among hedge funds that fueled the rally even further.

Trading volume for GameStop and meme stock favorite $AMC Entertainment (AMC.US)$ has faded. About 2.5 million shares of GameStop are changing hands daily based on a 30-day average as of Dec. 22, a fifth of that in January.
--- according to FactSet

Reddit traders also appear less focused on GameStop and AMC, which were the two most-mentioned tickers on WallStreetBets this year.
--- according to data tracker YoloStocks

WallStreetBets mentions for both peaked on Jan. 28 at about 267,000 for GameStop and 47,000 for AMC, but typical days for each over the past few months see hundreds, not thousands, of mentions.

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Meme stock fade. Source: CNBC

Despite recent market sell-offs with GameStop and AMC each dipping to their lowest levels in months on Dec.14. But both stocks are up this year, at about 707% and 1,245% as of Dec.27, respectively .