Gen Z investors are ditching meme stocks for the metaverse

Enthusiasm around meme stocks has eased for young investors a year on from the GameStop trading frenzy, with Gen Z’s attention shifting to companies in areas such as electric vehicles and the metaverse, according to a new report.

The top stock holding among the Gen Z cohort — people born after 1996 — in the fourth quarter was Tesla, according to the quarterly investor outlook from Apex Fintech Solutions, which provides custody and clearing services for brokers like SoFi, Stash, WeBull and Goldman Sachs Group’s Marcus.

AMC Entertainment slipped from the No. 1 spot in the top 100 ranking of stocks for the first time in several quarters, to No. 3, said the report, which analysed more than a million Gen Z accounts held by Apex’s clearing arm.

GameStop, which retail investors piled in to last January in a social media-fuelled attempt to punish short sellers, dropped five spots to No. 11, the report showed. Meme stocks with less mainstream buzz fell more, with e-commerce platform Wish’s owner, Context Logic, down 35 spots at No. 56 and biopharmaceutical company Ocugen dropping 41 spots to No. 91.

Electric vehicle start-up Rivian Automotive, which went public in November, debuted at No. 44, while Chinese EV maker NIO held the No. 8 spot and Ford was No. 19.

Shares of Facebook parent Meta Platforms rose a couple of notches to No. 12, while Roblox rose 36 spots to No. 36.

“There’s a lot more interest in metaverse,” Apex CEO Bill Capuzzi said in an interview. “As more NFT companies become public, we’ll probably see them move in to the top 100.”

The metaverse generally refers to shared virtual world environments which people can access via the internet, often making use of virtual reality or augmented reality.

Payment companies were also popular with young investors, with PayPal jumping nine spots from the third quarter to No. 19, while Block, formerly called Square, was steady at No. 25. 

— Reuters