For retail investors, the summer of 2025 is quickly turning into the latest meme stock moment.
Stocks like Opendoor (OPEN), Kohl’s (KSS), and Krispy Kreme (DNUT) have replaced yesterday’s meme darlings like GameStop (GME), AMC (AMC), and now-shuttered Bed, Bath & Beyond as the latest market curiosities, treating investors to wild price swings with little fundamental backing to explain the moves.
Opendoor stock is up more than 300% over the past month and saw a 140% increase in retail trading over the two weeks preceding Friday compared to the previous month, according to data from trading data platform VandaTrack. Even with a roughly 21% decline since the opening bell on Monday, the stock is up more than 50% over the last five days.
On Wednesday, Krispy Kreme and GoPro (GPRO) rose by more than 90% and 70% in premarket trading, respectively — the latest entrants in 2025’s meme stock redux. Both swung to losses before the bell on Thursday, after coming off intraday highs to close with less-spectacular gains.
What’s driving the renewed interest in highly speculative bets on names long ago written off by Wall Street? According to Interactive Brokers chief strategist Steve Sosnick, the market environment is simply right for risk.
“I think more and more investors are feeling somewhat invulnerable right now,” Sosnick told Yahoo Finance. “Everything they’ve been trying has been working for them. If the basic stuff’s working, why not try a bit more speculative stuff?”
After a historic drop in stocks following President Trump’s early April “Liberation Day” tariff surprise, the stock market has spent the past few months roaring back as worst-case scenarios for trade and the global economy appear less likely.
Now, the S&P 500 is routinely hitting record highs, including on Wednesday.
For investors who had the stomach to hold in early April, or even buy into the dip, those bets have largely worked out spectacularly well. And the winners haven’t only been confined to the meme darlings mentioned above.
The risk-on environment has been buoyed by steady belief in the AI trade from investors. Nvidia (NVDA) has seen its stock price increase by more than 90% since its April nadir, while shares in Microsoft (MSFT) and Meta Platforms (META) have grown by more than 40% since their respective April lows.
Crypto enthusiasm, which has also gotten a boost from the White House, along with a refreshed IPO market, has seen stocks like Coinbase (COIN), Circle Internet Group (CRCL) and CoreWeave (CRWV) — which recently announced a $9 billion acquisition of Core Scientific (CORZ) — shoot upward by more than 60%, 550%, and 200% since the start of the year, respectively. Robinhood Markets (HOOD), the retail investor-focused trading platform, is up more than 170% on the year.
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Even SPACs are seeing a resurgence from their 2021 highs, with more than 70 blank-check IPOs and more than $12 billion in issuance recorded since the start of the year, according to data from SPAC-focused hedge fund RLH Capital.
Data from Stocktwits shows some 68% of the options market is now in calls, or options for the right to buy a certain security at a certain price — the highest concentration since 2021’s meme stock craze. The firm’s data also shows more than 25% of all trading volume this year has been in stocks under the $5 share price line. Low per-share stocks were also a staple of 2021’s meme stock rally.
In January 2021, deep in the throes of the pandemic, speculative stock betting by retail traders reached a fever pitch. An explosive rally in shares of GameStop eventually canonized what investors now know as a “meme stock.”
Spurred by discussion on the subreddit wallstreetbets and the bull case made by one individual investor — Keith Gill, known to redditors as “Roaring Kitty” — GameStop shares swelled by as much as 1,600% in January 2021 before crashing in early February.
The rally in GameStop was so strong that it led Gabe Plotkin, founder of the hedge fund Melvin Capital Management, to shutter his fund after the firm’s short bets on GameStop went upside down in a “short squeeze” as the stock rallied.
An almost equally explosive run-up in AMC stock helped the theater operator stave off the threat of bankruptcy.
Four years later, the names are different and the gains may be more modest, but the shape of the rally is similar.
Wallstreetbets has been inundated over the past few weeks with posts about a growing basket of names that have been ID’d for potentially massive gains, including Opendoor, Kohl’s, GoPro, Krispy Kreme, and BitMine Immersion Technologies (BMNR).
As one post from earlier this week on wallstreetbets read, “Tastes like 2021 again. $130K YOLO on $RKT, 99.99% of my account on the line.” Rocket Companies (RKT) stock is up about 15% this week.
And taking a version of the role vacated by Roaring Kitty is hedge fund manager Eric Jackson.
Jackson, who rose to prominence for being an early spotter of Carvana’s (CVNA) turnaround, publicly laid out a bull case for Opendoor earlier this month with a price target of $82 for a stock currently trading below $3.
And much like 2021, small-cap names grabbing headlines now tend to have a relatively high percentage of their shares on the market sold short.
For Opendoor and Krispy Kreme, the percentage of outstanding shares being sold short is sitting at around 21% and 28%, respectively. Meanwhile, Kohl’s boasts a whopping 49% short float, which means that just under half of its outstanding eligible shares are being borrowed to bet the company’s share price will drop.
Some strategists have even suggested this “short squeeze” theme is playing a significant role in the broader market’s rebound from those April lows.
A notable difference from 2021, however, is that the half-life of trades on new-age meme stock names like Opendoor seems to be shorter than the timelines that ended up sustaining a long retail bull run on GameStop in 2021, Interactive Brokers’ Sosnick told Yahoo Finance.
“It could all end tomorrow, it could all end in months … Kohl’s is not going to suddenly become a great company tomorrow,” Sosnick said. “If enough people get on one side of an option trade, it can become self-fulfilling, at least in the short term.”
This market environment also isn’t without risk — and harm — to individual investors that are often swept up in these trades.
A study released in June from the CFP Board of Standards found that 57% of Americans have made a poor financial decision based on information they saw online, while 18% have lost more than $1,000 based on online information.
“This kind of retail behavior often marks short-term tops,” Stocktwits editor in chief Tom Bruni told Yahoo Finance. “When the buzz dies down in these highfliers, we usually see broader market consolidation or a pullback.”
Jake Conley is a breaking news reporter covering US equities for Yahoo Finance. Follow him on X at @byjakeconley or email him at jake.conley@yahooinc.com.
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