(Bloomberg) \u2014 It was once a symbol of rebellion against the well-heeled Wall Street establishment. Today, it\u2019s just another day in markets.<\/p>\n
Most Read from Bloomberg<\/p>\n
This week proved the point. Opendoor surged 43% in a single day. Krispy Kreme rallied 39% in a matter of hours. GoPro briefly spiked 73%. Reddit message boards lit up once again with rocket emojis and call-option bravado.<\/p>\n
Yet it wasn\u2019t the magnitude of the surges that mattered \u2014 but the indifference they met. Customary warnings about speculative excess fell on deaf ears. What once felt seismic now feels like a normal part of daily trading \u2014 another episode in a US financial system where bursts of retail speculation are routine, expected, and largely unremarkable.<\/p>\n
By the end of the week, with the quick rallies faded, the broader market ended with modest moves after a record-setting run. Meanwhile, crypto \u2014 once cast as the financial resistance \u2014 continued its steady march into the mainstream. A new blockchain-based project involving the likes of Bank of New York Mellon Corp. and Goldman Sachs Group Inc. was announced. Crypto funds posted their biggest four-week cumulative inflow ever. Michael Saylor\u2019s Strategy clinched another $2.8 billion in capital markets to fund additional Bitcoin buying.<\/p>\n
Taken together, the week offered a broader lesson: retail-driven speculative behavior no longer signals generational angst or post-pandemic distortion. It has instead become a settled feature of the current cycle. Short-dated options are part of the retail toolkit, trading platforms span everything from sports betting to complex stock bets, and manic episodes rarely require justification to take hold.<\/p>\n
Peter Atwater, an adjunct professor at the College of William & Mary who studies retail investors, said the current wave of activity reflects a shift in both market sentiment and investment toolkit. Meme stocks trading, he says, has lost its sense of novelty \u2014 and that\u2019s precisely the point. \u201cWe\u2019ve normalized memeing,\u201d he said. \u201cThere\u2019s a yawn to it now.\u201d<\/p>\n
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In Atwater\u2019s view, the most aggressive traders have already moved on to riskier frontiers \u2013 digital tokens, leveraged ETFs, prediction markets \u2014 while meme stocks have become more of a cultural rerun. \u201cIt\u2019s like 30-year-olds dancing to music 20-year-olds used to party to,\u201d he said.<\/p>\n
Story Continues <\/p>\n
That meme stocks can rip without stimulus checks, lockdowns or zero rates isn\u2019t especially surprising anymore. It is, in its own way, a marker of the moment: everyday speculation, embedded in the architecture of modern markets. Contracts that expire within 24 hours made up a record 62% of the S&P 500\u2019s total options so far this quarter, according to data compiled by Cboe Global Markets Inc., with more than half of the activity being driven by retail trading.<\/p>\n
\u201cThis generation is far savvier about options and market structure,\u201d said Amy Wu Silverman, head of derivatives strategy at RBC Capital Markets. \u201cWhile my generation was perhaps taught to \u2018buy a house\u2019 this one knows to \u2018buy the dip.\u2019\u201d<\/p>\n
It\u2019s not happening in a vacuum. This week earnings season offered few surprises. Tariff deadlines slipped again. Noise from the White House blurred into the investment backdrop. The S&P 500 climbed 1.5% on the week and closed at a record high.<\/p>\n
And in the end, a group of volatile stocks became yet another playground where regular investors aimed to quickly turn a profit, often by cornering short sellers or leveraging options. Opendoor Technologies Inc., capped a six-day winning streak with a 43% pop on Monday. The following days saw stocks with high short interest such as Kohl\u2019s Corp., GoPro Inc., Krispy Kreme Inc. and Beyond Meat Inc. surge intraday then pare into the close.<\/p>\n
Competition for gambling dollars is more brisk than it used to be. Since the post-Liberation Day selloff, a Goldman Sachs basket of the most shorted stocks has jumped more than 60%. In credit, CCCs, the riskiest tier of the junk bond universe, are on track to rack up a seventh week of gains. Crypto funds took in $12.2 billion in the past four weeks, their biggest cumulative inflow for such period, according to Bank of America Corp. citing EPFR Global data. US leveraged-loan market just had one of its busiest weeks ever with junk-rated companies rushing to reprice their borrowings multiple times.<\/p>\n
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And while the latest frenzy was reminiscent of 2021\u2019s pandemic-era burst, there were a few key differences. This week\u2019s action was fleeting, lasting one or two trading days before petering out. Concerted campaigns in the options market played a smaller role. More than half of the top 100 stocks in the S&P 500 index were trading with inverted one-month call skew in 2021, a sign of bullish intent, according to Cboe. This week it got only as high as 21% for the group.<\/p>\n
\u201cThe market makers and institutions have really adjusted to this phenomenon,\u201d said Garrett DeSimone, head quant at OptionMetrics. They\u2019re \u201cable to hedge their risk and they know how to price these options in across these scenarios,\u201d he said.<\/p>\n
If it signaled anything, enthusiasm for memes is more evidence that an ever-more-empowered retail cadre is a fact of Wall Street life that isn\u2019t going anywhere, at least not soon.<\/p>\n
\u201cI don\u2019t think it\u2019s the beginning of a new trend, but it is very interesting to watch because it speaks that the retail investor really wants to be involved in this market,\u201d said Jay Woods, chief global strategist at Freedom Capital Markets. \u201cThis is bullish. This is not bearish. This is not significant of a top.\u201d<\/p>\n
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\u00a92025 Bloomberg L.P.<\/p>\n","protected":false},"excerpt":{"rendered":"(Bloomberg) \u2014 It was once a symbol of rebellion against the well-heeled Wall Street establishment. Today, it\u2019s just…\n","protected":false},"author":2,"featured_media":37661,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[37],"tags":[7904,28,30623,28222,26330,8146,112,30624,21260,918],"class_list":{"0":"post-37660","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-markets","8":"tag-bloomberg","9":"tag-business","10":"tag-capital-markets","11":"tag-goldman-sachs","12":"tag-krispy-kreme","13":"tag-market-sentiment","14":"tag-markets","15":"tag-peter-atwater","16":"tag-retail-investors","17":"tag-wall-street"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/37660","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/comments?post=37660"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/37660\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media\/37661"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media?parent=37660"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/categories?post=37660"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/tags?post=37660"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}