Bubbles across Meme Stocks and Cryptocurrencies

Arash Aloosh, Samuel Ouzan and Syed Jawad Hussain Shahzad

Finance Research Letters, 2022, vol. 49, issue C

Abstract: This study examines the price explosiveness of stocks whose purchase Robinhood restricted during the GameStop episode. We find that those “meme stocks” comprise multiple periods of explosiveness, indicating that they are unlikely to be an epiphenomenon. We also document evidence of price co-explosivity among meme stocks themselves and cryptocurrencies and meme stocks. Given the historical low correlation between the stock market and cryptocurrencies, our results highlight the impact of social media and emerging trading applications on interactions among equity and cryptocurrency markets, and their potentially destabilizing effects on both.

Keywords: Price Explosiveness; Co-explosivity; Meme Stocks; Cryptocurrencies; GameStop; Social Trading (search for similar items in EconPapers)
JEL-codes: C12 C22 G12 G14 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:49:y:2022:i:c:s1544612322003774

DOI: 10.1016/j.frl.2022.103155

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