Meme Stock

What does meme stock mean?

A stock hyped on social media

Meme stocks are stocks that increase in value primarily due to social media hype, which causes a large number of retail investors to buy the stock. While meme stocks have existed for years, they drew worldwide attention during the covid pandemic, as coordinated groups of retail investors sent companies like GameStop and AMC Entertainment's share prices soaring.

How did meme stocks take off in 2020?

In 2019, Redditor u/DeepF***ingValue began encouraging other members of the r/WallStreetBets subreddit to purchase GameStop (GME) stock. u/DeepF***ingValue both liked GameStop as a company and noticed that many institutions had shorted GameStop shares (meaning they bet the shares' prices would fall). By encouraging other investors to buy GME, u/DeepF***ingValue hoped to increase the price of the company's shares, forcing those who had shorted the company to buy the stock retail investors now held. This increased activity would then drive share prices even higher. In stock market lingo, this strategy is called a short squeeze.

When the covid pandemic hit, many people found themselves with additional free time and money on their hands. Others desperately needed a way to make some much-needed cash. Some of these people decided to take u/DeepF***ingValue's advice, leading to a snowball effect that quickly became a stock market and social media phenomenon. GME's share price soared, and terms like diamond hands, paper hands, and tendies entered the public lexicon.

What are some non-GME meme stocks?

GME was the pandemic's first meme stock, but it was not the last. Retail investors and social media hype have also buoyed AMC Entertainment (AMC), BlackBerry (BB), and Bed, Bath, and Beyond's (BBBY) stocks. While not every meme stock remains a long-term success, it seems the meme stock phenomenon is not going away anytime soon.

Example

"I assume that by the time I've heard of a meme stock, it's too late to profit."
Trading app Robin Hood is a catalyst of the meme stock movement

Trading app Robin Hood is a catalyst of the meme stock movement

Related Slang

Usage

Last Updated: August 5, 2021

Meme stock definition

This page explains what the slang term "Meme stock" means. The definition, example, and related terms listed above have been written and compiled by the Slangit team.

We are constantly updating our database with new slang terms, acronyms, and abbreviations. If you would like to suggest a term or an update to an existing one, please let us know!