In a quiet week by 2021 standards, the speculative excesses that have defined this bull market hit new records with little fanfare.
Wild trades from penny stocks and “meme” cryptocurrencies to cannabis companies surged to all-time highs. U.S. equity indexes rose anew. And skeptics on the everything rally found more reasons to fret over market froth.
Stocks have added more than $6.8 trillion globally in six weeks. Digital currencies have boomed to a market cap of more than $1.4 trillion. Cathie Wood’s tech-focused ETFs now manage over $50 billion and counting.
Get used to it for now, say strategists at Goldman Sachs Group Inc.
“More bullish sentiment suggests risky assets are now more vulnerable to disappointments on the recovery or on central bank support,” a team including Alessio Rizzi wrote in a note. “But positioning can remain bullish unless one of these risks materialises.”
After a week which recorded the strongest-ever inflows to equities, here’s a look at “meme” trades gripping social media and Wall Street right now.
Pot and Crypto
For the most part, cannabis and cryptocurrencies have surged in tandem in 2021, suggesting both have been riding the wave of online retail investor enthusiasm.
The past week has been a wild ride for pot stocks. The ETFMG Alternative Harvest ETF (ticker MJ) posted its largest three-day rally on record with a 42% surge, before plunging 26% in two days.
Bitcoin is up 63% this year, notching a historic high of $48,929 on Friday.
Retail Favorites
Whether they’re chasing price momentum or betting big on the recovery trade, the day traders mesmerizing Wall Street have been racking up big profits, according to a Goldman Sachs basket tracking their favorite names.