Meme stocks have proven their capacity to cripple hedge funds and take Wall Street by storm. But are they actually worth investing in? Here are four trading chat rooms to keep an eye on as meme stocks make headlines.
Meme stock saga: Redditors vs. Wall Street hedge funds
In January, GameStop’s stock rose 1,625%, according to Bloomberg. And it wasn’t the only stock to pop. AMC and Nokia also saw dramatic gains, and then all fell back — a market-impacting swing organized and executed by so-called meme stock traders So, how did these traders orchestrate market swings that cost the hedge funds that shorted GameStop and similar stocks billions? Reddit. Or more accurately: a subreddit called r/wallstreetbets.
What are meme stocks?
The stocks targeted by WallStreetBets Redditors have been appearing in news headlines under the moniker meme stocks. But the name is far from new. Meme stocks have been flitting across Reddit forums for years and have recently captured the public’s attention via the GameStop short selling throwdown. For the uninitiated, meme stocks are stocks made popular via social media or investing forum. They tend to be volatile and gain traction not because of their inherent growth potential, but because they’ve somehow captured the attention of retail investors. More often than not, meme stocks stand as something of an inside joke among investors that frequent these online forums. Whether the stock has any inherent merit seems to be beside the point. But if recent events are any indication, meme stocks — with the right momentum — have the potential to shift the market. And it all comes down to chat room investing.
4 trading chat rooms to watch
The market is changing, and with it, the way people invest. As retail investors take to online brokerages in droves, online chat rooms are becoming the increasingly popular forum for investors to swap strategy, ideas and market news. If you want to stay ahead of the next meme stock trend, explore the following trading chat rooms.
1. Reddit
Given the recent news, it should come as no surprise that Reddit makes this list. And for a demonstration of what type of power Redditors wield, you need look no further than GameStop’s stock — a power play orchestrated by the subreddit r/wallstreetbets. Reddit is a network of social communities organized by forums called subreddits. Under the r/investing/ subreddit, you’ll find millions of Redditors discussing everything from company mergers to deep dives on individual stock performances.
2. StockTwits
StockTwits is a social media platform designed for investors. It’s free to create an account, and once signed up, you can browse message threads by numerous categories that include charts, equities, forex, futures and more. It’s essentially Twitter for trading news, standing over 3 million members strong with 5 million messages exchanged monthly.
3. TechBud Solutions
Are you a fan of Facebook? Try TechBud Solutions: a peer-to-peer Facebook group focused on helping investors gain knowledge, trade strategies and discuss pertinent market news. It’s a private group, so you’ll need to request to join. Once approved, you’ll gain access to the entire TechBud Solutions community — now sporting over 300,000 members. You can post questions, respond to discussions and review archived threads — all from the comfort of Facebook.
4. Warrior Trading
If you’re willing to shell out a monthly fee for access to daily watchlists, streaming stock scanners and daily commentary from top Warrior Trading investors, you may want to give this platform a look. Access to the Warrior Trading chat room doesn’t come cheap — you’ll pay a whopping $197 monthly — but that’s because the chat room feature is only accessible through one of Warrior Trading’s education packages. If you’re looking for a structured learning environment, this platform may be for you. The bottom line is that regardless of what you encounter on a message board, you’ll need a brokerage account to invest. And while there are plenty of opportunities to learn from these online forums, be wary of misinformation and do your due diligence before executing any trades.
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Shannon Terrell is a lead writer and spokesperson at NerdWallet and a former editor at Finder, specializing in personal finance. Her writing and analysis on investing and banking has been featured in Bloomberg, Global News, Yahoo Finance, GoBankingRates and Black Enterprise. She holds a bachelor’s degree in communications and English literature from the University of Toronto Mississauga. See full bio
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