The meme stock craze exploded in 2021 when Reddit’s WallStreetBets forum began buzzing about GameStop (GME). Hedge funds had heavily shorted the stock, which led to online retail traders speculating about a possible short squeeze. This skyrocketed GameStop’s share price within a short timeframe. Weeks later, the same happened to other stocks.
If you’d invested $1,000 in some of these meme stocks back in 2016 or at their IPO for newer companies, your portfolio would look dramatically different today. Some stocks delivered massive gains. Most didn’t. And a few wiped out the majority of an investor’s money.
