Opendoor, Kohl's and Gopro are some companies whose stocks have soared on the US stock exchanges in the past month with increases from just over 50 to over 350 percent. But behind the increase lies not strong results or future prospects, but that they have been noticed on media platforms like Reddit.
We have seen in recent years that there are many new and young investors. As we have gained access to digital marketplaces, it also becomes easier to get caught up in these stocks, says Shoka Åhrman.
Waiting for too long
The phenomenon of Meme stocks - a "meme" is something that gets rapid spread in social media - received great attention when the game store chain Gamestop's stock soared in mid-May last year. A few days later, the stock plummeted on the New York stock exchange after the company issued a profit warning.
Meme stocks are often low-valued but when they are hyped in social posts that go viral, the prices can shoot up. The problem is that many jump on the bandwagon too late or wait too long to sell.
Those who leave last are often those who wait a little too long and when they step off, it's with a loss. Those who initiate or drive these trends often have already left before the fall. It's not them who lose money, but often small investors, says Åhrman.
Great risk
Her advice is not to look at the price increase itself, but the basis for it: What kind of company is it and why is the price soaring? Is there a recommendation or analysis behind it?
If it's a big price increase, there's often also a risk associated with it, according to Shoka Åhrman.
You need to keep in mind that if it seems too good to be true, it often is. There are no free lunches.
