Part 6/9:
Market Conditions: The environment is more cautious. In 2021, the market was buoyed by low interest rates and abundant liquidity due to massive government stimulus during the COVID-19 pandemic. Now, interest rates are higher, and liquidity is tighter, making speculative trades less attractive.
Shift in Investor Activity: Many retail investors have returned to their usual routines, with less time and appetite for risky, speculative investments.
Risks and Cautions for Investors
Experts unanimously agree that meme stocks are highly risky ventures. Here are key considerations:
- Extreme Volatility: Meme stocks can experience rapid price swings, unlike stable, blue-chip stocks like banks or utilities.