How Intelligent Investors Should Look at Meme Stocks
Are meme stocks worth your money…and sanity?
A lot of people got an allowance when they were little. Parents hand their kids a crisp green rectangle with George Washington’s profile and tell them it’s their dollar to keep. Usually, it was for cheap labor like folding laundry, mowing the lawn, or vacuuming the house. (Kids should unionize.)
This commences the typical person’s relationship with money and personal finance. At least, it did for me.
The relationship truly starts to blossom when we understand the fundamentals of money, the most basic of which is saving. Over time, we link the importance of saving with investing. Because when we save and invest the “right way,” we benefit from exponential growth through compound interest.
The “right way” involves rational strategies that consider goals, time horizons, and risk. We learn that risk is necessary to generate a return — but, for practically all of our investments, risk should be calculated not speculative.
Because speculation is like gambling.
Meme stocks fit the definition of “speculation” to a T.
