The growth of meme stocks has spurred retail traders and meme-makers to seek out these obscure penny stocks. These stocks have a few things going for them. They can be a source of risk and reward, but their biggest asset is their massive following. Meme stock trading has exploded this year, and the debate among traders is whether or not they’re still a good investment. But here are some things you should know before investing in a particular stock.
One of the most compelling stories recently is the story of SpectraScience, which has become viral. It’s one of about a dozen similar stories about penny stocks that went public in 2021. Many of these stories were anticipated by social media accounts. As a result, zero-commission retail traders have become a significant part of the stock market, accounting for as much as 20 per cent of the volume of trading last year.
There have been several instances of cultish social media accounts fueling penny stock trading. A recent example is GameStop Corp., which rose 633 per cent in a single session after announcing its first-quarter earnings. The company had failed to file reports for years and was subject to a massive hysteria. This frenzied behavior was most likely amplified by bots.
When you trade in penny stocks, it’s crucial to have a strategy in place. While some penny stocks will skyrocket hundreds of percentage points, others will fail altogether. It’s important to know what aspects of the company you’re buying, as well as what you’re willing to give up in the future. In addition, keep in mind that a cheap stock does not necessarily mean a massive gain. Former penny stocks have been known to rally thousands of percentage points, but there are many former penny stocks that failed to do so.
In the last few months, penny stocks have become a hot topic. The onset of the pandemic and the downturn in the market have made these stocks even more popular. Although these stocks are cheap, they’re not always worth investing in. The upside is often greater than the downside. A good strategy should focus on finding cheap stock investments, but keep in mind that they’re also high-risk.
The rise of a small social media stock can be huge or small. Despite its size, some penny-stocks are not legitimate and are being scammed. For instance, one company that was once considered a “famous” stock has experienced a staggering surge in its share price. Another example is Cynk, a small company that had no revenue and no assets. The CEO owned $3.5 billion worth of shares in a company that had no real value.
It’s important to understand that cultish social media accounts can also cause a lot of problems for traders. If you’re looking to buy a penny stock, you need to look beyond its reputation. If you’re buying a cultish stock, you may be putting your money at risk. If you’re not careful, it’s likely that it’s a fraudulent company.
The US Securities and Exchange Commission recently charged a California trader with fraud after spreading false tips on Twitter. The trader used his twitter handle, @OCMillionaire, to spread false information about Arcis Resources Corporation. But his followers were only interested in his tweets and not his actual content. Those who followed Fassari’s tweets aren’t aware of the potential harm that their tips can cause.
In recent days, cultish social media accounts have caused a lot of trouble for investors. These accounts spread false tips and manipulated prices on a daily basis. In the case of a California trader, Andrew Fassari was accused of fraud by spreading false information on Twitter about Arcis Resources Corporation. His followers are mostly novices with no knowledge of the company. He also used fake tweets to boost his Twitter account’s popularity.