Trading volumes on popular meme stock Gamestop (GME) rose by 194% in the last two weeks on investment trading platform Capital.com, suggesting meme stocks continue to retain their appeal even after Reddit’s WallStreetBets hype last year. 

According to data released by Capital.com, 59% more retail investors traded GME last week compared to a week earlier. Over the same period, trading volumes on AMC Entertainment (AMC) were up by 226% on the Capital.com platform. The two week winning streak across meme stocks coincides with AMC’s price rally this week - on Monday, 28th March, trading volumes on AMC surged by 447% on Capital.com, in tandem with a 45% price rally on the same day. 

David Jones, Chief Market Strategist, Capital.com, said:

“Just when we thought the meme stock fad was so 2021, the two old stalwarts - GameStop and AMC - are back with a vengeance over the past couple of weeks. We’ve seen a significant interest amongst our clients in trading the stocks - after all, there is nothing like a change in price to attract traders, like moths to a flame. The GameStop stock price has more than doubled since 17 March and AMC Entertainment has done almost as well.

Looking at GameStop in more detail, this is quite the change in sentiment from earlier this month when it had traded to its worst level since May 2021. This represented a drop of more than 80% from the highs set in June of last year. Getting traders excited this time around may have been rumours alleging that short-sellers were closing their trades - plus the company’s plans for an NFT (non fungible token) market place. 

The whole meme stock craze started in January 2021 on the premise of squeezing short sellers, so it is not surprising the impact this sort of rumour might have. And on the subject of NFTs, some would see them as a natural evolution of the world of cryptocurrencies. Regardless - the mention of its NFT plans in the GameStop quarterly update on 17 March seemed to help ignite at least some interest in the stock.

So what next? If there is one thing that the past 18 months might have told us about meme stocks it is that those late to the momentum party tend to be left out in the cold.  Given the moves over the last couple of weeks, perhaps some traders may well be reluctant to buy in before there is a significant dip. But whatever the strategy here, the recent volatile session  for both AMC and GameStop does remind us that perhaps talk of the death of the meme stocks had been somewhat premature.”