Meme stock trading is back with a vengeance, with shares of companies like Kohl’s, Opendoor, and GoPro popping as investors chase thrills. Goldman Sachs’ Speculative Trading Indicator is at its highest level outside of specific periods, indicating a rise in trading volume in unprofitable stocks and penny stocks. Analysts see this as a sign of investors’ strong risk appetite.

The return of meme stock trading echoes past stimulant-induced rallies in GameStop and AMC during the pandemic. Online coordination seems to be driving the outsize moves in highly-shorted names. Analysts believe the recent surge in speculative trading points to investors’ willingness to take on risk, with call options accounting for a significant portion of options volume.

The surge in meme stock trading is reminiscent of past market trends, with the performance of stocks going public in June being the best since early 2024. However, historical data shows that sharp increases in speculative trading activity tend to precede short-term market gains followed by downturns. Investors are advised to proceed with caution amidst the current market frenzy.

Read more at Yahoo Finance: Meme Stocks Partied Like It Was 2021 This Week. What’s Next?