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Why GME and AMC Investors Hate These YouTube Videos

The SEC has released a series of videos warning investors about the "gamification" of the markets. GME and AMC investors think they've gone too far.

On its official YouTube channel, the U.S. Securities and Exchange Commission (SEC) has been releasing a series of short videos in a campaign to protect investors from the "gamification" of the financial markets.

According to the SEC's website, the "Investomania" campaign "uses a game show concept to educate investors playfully that investing is not a game and that they should do their due diligence when making investment decisions."

The videos touch on topics such as "easy money," buying stocks on margin, cryptocurrencies, and – last but not least – meme stocks.

Take a look at the latest video, which pokes fun at meme stock investors who don't do their research before investing:

GME and AMC Shareholders are Furious

Although the video doesn't mention any stocks in particular, it's not a stretch to say it alludes to GameStop  (GME) -  and AMC Entertainment  (AMC) - . Those have been the top meme stocks to receive attention from retail investors.

As a consequence, the video has drawn a lot of ire among the GMC and AMC investor communities on social media.

These communities have been criticizing the SEC already for what they consider a failure to protect them from market manipulation practices such as naked shorting, a lack of transparency with payment-per-order-flows, and dark pools.

In October 2021, the SEC released a report on GameStop's trading activity in January 2021. The report concluded that the causes of GameStop's unbelievable share price spike were:

  1. Frequent Reddit mentions
  2. Significant coverage in the mainstream media
  3. Large volume changes
  4. Elevated short interest

In the report, the SEC mentioned that it was still identifying "areas of market structure and regulatory framework for potential study and further consideration." These include:

  1. Forces that may cause a brokerage firm to restrict trading; 
  2. Digital engagement practices and PFOF, i.e. payment for order flow;
  3. Dark pool trading;
  4. The market dynamics of short selling.

The Bottom Line

Meme stocks are stocks that have gone viral on the internet not necessarily due to their business fundamentals but because of investor sentiment. Like other high-volatility assets, they pose huge potential risks that investors must be aware of.

The SEC should protect the markets as broadly as possible and educate retail investors to help them act as thoughtfully as possible when putting their money somewhere.

However, to many meme investors, the SEC's campaign demonizes their favorite stocks. And, although they're risky, meme stocks are definitely not all bad.

The meme stock phenomenon has shown the markets what happens when large numbers of retail investors band together and move stocks higher. Meme stocks are also a symbol of the democratization of the markets, something investors have been trying to achieve for a long time.

(Disclaimers: this is not investment advice. The author may be long one or more stocks mentioned in this report. Also, the article may contain affiliate links. These partnerships do not influence editorial content. Thanks for supporting Wall Street Memes)