Reddit is home to a vast amount of information, and the communities discussing investments are incredibly active. As a result, some people look to Reddit to learn about stocks with potential or at least discover what’s generating buzz. If you’re interested in what the platform is talking about, here is what you need to keep in mind when looking at meme stocks, as well as a list of the seven of the best stocks to buy now, according to Reddit.
What to Know Before Investing in Meme Stocks
Meme stocks are investments that have garnered attention on social media, often leading to a higher amount of trading activity. Does this mean the stock has long-term potential? Potentially, yes, but also possibly no. The reason these stocks gain attention can vary, and sound business practices or the ability to generate growth isn’t always part of the equation.
For example, the GameStop stock incident didn’t have anything to do with GameStop’s strength as a company. Instead, Redditors were taking action against hedge funds that were shorting the stock, causing those hedge funds to suffer significant losses. The goal wasn’t to generate gains for the Reddit community but to strike at hedge funds.
As a result, not all stock buying recommendations are based on sound advice and long-term potential. However, a notable amount of what’s discussed in stock-related communities on Reddit does aim to help others secure gains. Anyone turning to Reddit for advice simply needs to make sure they’re looking at why various buying or selling actions are recommended. That way, they don’t invest hoping for long-term growth only to discover that the activity is based on a different kind of trend.
Best 7 Stocks to Buy Now According to Reddit
- Nvidia (NVDA)
Nvidia stock has been doing incredibly well this year, and many believe there’s room for more growth. The stock’s growth well surpasses the market average, and many experts believe its price could double over the next 12 months.
- Advanced Micro Devices (AMD)
AMD hasn’t had a great August, primarily due to broader challenges in the PC market. However, AMD is investing in some key areas – including artificial intelligence (AI) – and will have new chips in production toward the end of the year. Plus, its revenue is climbing, so there’s a decent amount of growth potential.
- Tesla (TSLA)
Tesla’s stock value often has more to do with investor sentiment than pure business practices, which can cause a lot of volatility. Still, while Tesla stock prices have seen some declines during the year, its current cash-held amount compared to its debt means higher interest rates won’t pummel the company as hard as some other companies may face. Tesla has also adjusted its vehicle pricing strategy, leading to more volume. Ultimately, the stock does have the potential for value increases.
- DTE Energy (DTE)
DTE Energy is a utility company based in Michigan, and it’s strong financially. The company also has ambitious plans for future operational investments, which could position it for significant growth in the near future. Many analysts (as well as Redditors) consider it a buy at this time.
- Invesco QQQ ETF (QQQ)
For investors interested in the innate diversification provided by ETFs, Invesco QQQ is generating a lot of buzz on Reddit. Its long-term outlook is solid, which could be attractive to buy-and-hold investors. Plus, there may be some short-term price declines in the near future, which could allow investors to capitalize on a dip.
- Vanguard Total Stock Market ETF (VTI)
Like many stocks, the Vanguard Total Stock Market ETF saw some declines when inflation began running rampant. However, it’s got a strong historical performance, and it’s poised for gains as the economy stabilizes. As a result, it’s worth taking a look at now, as it could have some notable growth potential.
- Carvana (CVNA)
Carvana has had an interesting 2023, and it just secured a major win in the form of a new Illinois law that effectively codified vehicle home delivery in the state. While the new legislation doesn’t go into effect until January 1, 2024, it functionally guarantees access to the sixth-largest state (based on population).
Do you know of any more of the best stocks to buy now, according to Reddit? Do you think that Reddit has good advice, or are you wary of any recommendations? Share your thoughts in the comments below.
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Tamila McDonald is a U.S. Army veteran with 20 years of service, including five years as a military financial advisor. After retiring from the Army, she spent eight years as an AFCPE-certified personal financial advisor for wounded warriors and their families. Now she writes about personal finance and benefits programs for numerous financial websites.
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