Beware of simply ridiculing the ‘meme stock’ phenomenon

In his last note of the northern hemisphere spring, Nuclo Independent CIO head of global equities Claudio Brocado briefly discusses the importance of heeding the messages from markets. Most investors tend to have opinions on market moves, and many often disagree with the pricing at which individual securities trade. This phenomenon appears to have intensified in recent months as ‘meme stocks’ have garnered a larger share of the news headlines than their direct economic relevance and market capitalization levels would seem to warrant.

As Claudio discusses in this note, while not endorsing the individual securities, let alone advocating that investors participate in these stocks, there may be important lessons to be learned from the phenomenon with applicability to future market trends.