The shares currently trade for about $28 apiece — up 68% year to date, and a serious gain from the roughly $10 share price in late April, but a far cry from the $125 (In 2021, speculators on Reddit and other social media platforms pumped the price of stocks that were heavily shorted by institutional investors. The resulting jump in share prices forced a so-called short squeeze, in which the short-sellers were forced to sell to cover loses, pushing prices even higher.
It's not an illegitimate feeling, he says. And of course, if you time a speculative trade exactly right, you could earn big profits. "Then it does what it does every time, which is it goes back down," Portnoy says. "That doesn't mean you can't be a successful trader, but if you're a regular person watching intense price activity saying, 'Hey, I want to get mine,' it's a very dangerous thing to get involved with."
This phenomenon comes down to what Klontz and Portnoy call herding behavior, but can could just as accurately be described as investing FOMO — fear of missing out. "If you're going to get into the world of trading, you're going to get wrecked. There's, like, a 99% probability that you're going to lose money, if not all your money," he says. "And the longer you trade, the likelier it is you'll lose."
Ideally, you manage your finances based on your specific goals for the future. Before buying any speculative investment, consider if and how it fits in to your specific plans.