Stock Exchanges Meme shares and the power of the online nation were confused in 2021 – Is it time to bury the old laws of the stock market?

Meme stocks may have come to stay.

In January 2021 supplier Thomas Friedman presented a vivid description of the U.S. stock market, teeming with hyenas, vultures and lions. Friedman referred to gamestop Gamestop, which is at the heart of some jumping, and the value of the share he expected to fall back to € 4.50 after the online people’s withdrawal subsided.

So far, Friedman’s prediction has not come true. The value of Gamestop’s share has still fallen to 160 euros, although the company is making a loss.

The metaphors used by Friedman still provide a delicious example of the way in which financial markets are analyzed in familiar words from the animal and plant world. There are winners and losers in the market, growth and death. Balance is always found in the end.

But then came the year 2021, and the laws of nature no longer apply.

The same expenditure is likely to continue in 2022.

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Traditional theories are not enough to explain why stock prices of companies like Gamestop continue to rise, even though all the facts and return expectations speak against it. The so-called meme shares launched by the online people are a new phenomenon.

Traditionally what goes up is supposed to come down before long.

In the case of meme stocks, this is also uncertain. Like Victoria Chui and Moin A. Yahya In their study, Memi shares are not a so-called pump-and-dump phenomenon, in which the value of a share is first artificially inflated and then the shares are sold in the hope of making a quick profit.

In addition, they are not involved in online defamation campaigns in which a short seller spreads malicious gossip about a company to get its course down. Instead, meme stocks seem to represent a pump-and-hold model that is foreign and new to the market.

A lot of ink has been shed to reflect on where the meme stocks originated. Was it a rebellion of the righteous against Wall Street speculators or a pastime invented by private investors bored by coroner embargoes?

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Be that as it may, the power of the online nation has proved its worth, at least from time to time.

Robinhood platform has run into difficulties since its IPO in August, but similar stock – playing applications have sprung up. The trend is expected to continue or even intensify.

The more traditional actors who have woken up to reality want their share of the cake too.

A listed fund based on the Memi-Equity Index, developed by Roundhill Investments, which specializes in investor advice, is awaiting regulatory approval.

In the cryptocurrency market, mainstream interest stabilized the position of crypts as more than a momentary madness. The same may soon be true for meme stocks.

When In May, South Korea lifted its ban on shorting due to the pandemic, and a large number of short positions were taken against container transport company HMM and industrial company Doosan Heavy.

Private investors, called ants, rushed to the rescue. In 2022, ants will get a new weapon when shares of shares will also be traded in Korea.

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If the willpower of private investors alone is enough to raise and maintain the value of shares, old theories may need to be reconsidered. Ants also have a place in the cycle of life.

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