Love it or hate it, the Meme Market is back, and Wall Street strategists say it can’t be ignored.
While shares of AMC Entertainment (AMC) are having a volatile Thursday, the social-media-fueled trading frenzy has pushed shares of AMC up nearly 3,000% this year, giving the money-losing movie theater chain a market value of more than $30 billion. AMC is not alone. Shares of Bed, Bath & Beyond (BBBY), Express (EXPR), and BlackBerry (BB) are all up this year. It’s reminiscent of the eye-popping run-up in shares of Gamestop (GME) that we saw back in January, when the Reddit investing crowd bought shares of the struggling video game retailer to stick it to the Wall Street pros who were betting against the stock.
Ryan Nauman, market strategist at Zephyr told Yahoo Finance Live that wild trading in these so-called meme stocks is not so much a “threat” to the broader market as it is a “learning experience.”
“This is no longer our grandparents’, or for that matter, our parents' stock market,” Nauman said. “Now, investment professionals need to start focusing more on looking at alternative data sets, rethinking their investment thesis to consider this growing cohort of retail investors.”
Even if you’ve vowed to stay away from the “meme trading madness,” you may own AMC and GameStop and not even know it, because the stocks are still part of the Vanguard Russell 2000 Value Index Fund ETF Shares (VTWV). The recent rallies in those two stocks have pushed the Russell 2000 Value Index up 30% year-to-date, dusting the Vanguard Russell 2000 Growth Index Fund ETF Shares' (VTWG) 3.8% gain during the same period.
