Meme stocks go big in Europe
For the past little while, I’ve been receiving email updates from German-Dutch discount broker DEGIRO.
It’s been fun to read their summaries of trading across EU countries. In particular, they show you the most-traded stock in each EU country, on their platform.
My conclusion? Very simply, it turns out that European investors love American meme stocks almost as much as the Americans do.
Here is the most recent map:
Previously, Gamestop ($GME) was all the rage.
Even the blogger at DEGIRO, a company which benefits from frenzied trading, feels the need to point out that cinema chain AMC might not be worth its current market cap:
Essentially, the short-sellers are ‘squeezed’ out of their positions. Artificially inflating stock prices does not reflect the true value of AMC, which has struggled amid the Covid-19 pandemic with movie theaters being closed for months.
On May 6th, AMC published its first-quarter earnings, reporting a loss of $567.2 million, more than what analysts had expected. Despite this, prices surged during the month, ending May up by 160.42%.
Whether Gamestop or AMC, Europeans also feel the need to trade these “fun” stocks.
But I expect that it won’t be fun when the music stops.
Most people will wisely watch the volatility from the sidelines, neither buying nor shorting. I must admit: I am very tempted to take advantage of what look like some very clear mispricings in the most popular stocks. Tesla ($TSLA) is not the only game in town.