Why is it called a meme?
Richard Dawkins, a famous British evolutionary biologist, first coined the word in his 1976 book, "The Selfish Gene." Grumpy Cat became the inspiration for numerous memes. The term meme comes from the Greek word mimema, which means "that which is imitated." The word is abbreviated to "meme" as a play on the word "gene."
What is Meme?
A meme is an idea or behavior of cultural information that spreads by imitation. In prior generations, memes typically spread within local cultures or social groups. Today, memes include beliefs, fashions, stories, and phrases. Using different social media platforms memes express culturally relevant themes. A meme can be an image or video that conveys the collective thoughts and feelings of a specific group.
What are examples of Memes?
Most of the popular memes in social media today are photos and viral videos that are often engaging, amusing, and playful. One of the more popular internet memes is Condescending Wonka/Creepy Wonka. It derives from the Willy Wonka and the Chocolate Factory film. As the name implies, it is patronizing and sarcastic. Another famous meme is "lolcat" or a compound word from "lol" (laughing out loud) and the word "cat." The meme is often an image of one or more cats set in a large caption of Sans Serif or Arial Black font. It sends out a message of being funny and often includes jokes. The Success Kid meme originated in 2007. It is a photo of Laney Griner's 11-month son Samuel, clenching a fistful of sand with a determined facial expression. The Success Kid meme is one of the internet's first viral memes and likely the internet's most famous baby. It denotes a feeling of celebration and accomplishment.
Meme stocks and Meme ETFs
Fueled by social media and the popularity of day trading, especially from young traders taking their stock-picking clues from Reddit forums and other social media platforms, it has forced Wall Street to pay more attention to the stocks that are mentioned frequently on the internet (i.e., GME, DKNG, F, TSLA, etc.).
Although it is contradictory for the financial industry to promote an ETF-based that is in direct competition to its professional constituents, a new exchange-traded fund (ETF) called the Van Eck Vectors Social Sentiment ETF (BUZZ – 24.82) began trading in March 2021. BUZZ tracks an index composed of 75 U.S. stocks benefiting from positive investor sentiment and bullish perception expressed through social media, news articles, blogs, online discussion forums, and other alternative datasets. The top 10 holdings of BUZZ, as of 4/6/21, are AMZN (3.13% market-cap weighting), AAPL (3.11%), BA (3.09%), AMD (3.08%), DIS (2.96%), SQ (2.93%), TSLA (2.84%), NVDA (2.84%), SPCE (2.82%), and NVAX (2.73%).
Every month, the portfolio of 75 stocks is updated to reflect the stocks that are attracting the most positive investor sentiment and outlook.
If you are having a hard time understanding these young day traders, then you are not alone. Professional investors are perplexed by the sudden popularity of meme stocks and the influence they have on trading. The professionals continue to fall behind a new generation of traders, driven and widely influenced by social media Redditt forums and various social media platforms, and readily embracing new and innovative trends (i.e., digital currencies, EV self-driving cars, legalized weed, etc.).
Only time will tell if these young retail traders can continue to fuel buying sprees of trendy meme stocks. BUZZ ETF is a far more rational and reserved way to participate in some of these trendy meme stocks without getting caught up within the hype and mania of the "to the moon!" crowd.