There are two types of stocks in this world – those with relatively stable values, and volatile investments that are constantly moving. The latter are the preferred investments for experienced day traders, giving large rewards in short periods for those who correctly predict their movement.
If you want to day trade stocks that move a lot it’s up to you to perform due diligence and understand when to invest.
A volatile stock isn’t a bad investment, and it doesn’t indicate a volatile business. There are a lot of large companies with a lot of price movement, especially in the wake of the coronavirus lockdown. Check out these five volatile stocks for day trading.
Beyond Meat (BYND) Is Volatile
Few investments have as many ups and downs and Beyond Meat [BYND]. This plant-based meat substitute manufacturer in Los Angeles has a lot of backing, with institutional investors including Bill Gates, the Human Society, and Tyson Foods. By 2018, these plant-based proteins were rolled out in A&W, Carl’s Jr., and Del Taco across North America.
Beyond Meat expanded from plant-based chicken to include burgers and sausage, and it has a focus on sustainable solutions. Of course, the company isn’t alone in its quest, as competitor Impossible Foods released burgers and pork that took 2019 by storm, stealing some shine.
The stock is known to change heavily throughout the day, and it entered 2020 with great brand recognition and generally positive product reviews.
Although hit by the coronavirus lockdown like everyone else, Beyond Meat recovered quickly and is expected to perform well for the rest of the year, as consumers and restaurants seek meat alternatives as the meat supply chain fails.
Peloton Interactive (PTON) Is A Nail-biting Ride
The past year has been tumultuous for Peloton Interactive [PTON], but the company still has investors’ undivided attention in the wellness space.
If you’re not familiar with the company’s products, it’s more than just an exercise bike. Peloton is a media company that provides guided exercise routines and other content for its users.
Peloton stands head and shoulders above much of its competition when it comes to software and seamlessly connecting users across the globe.
It’s also more than an “exercise bike company” with a screen. Now Peloton features treadmill, yoga classes and much more.
Of course, the company’s holiday commercial went viral for all the wrong reasons. The story of a woman improving her body to look good for her husband came off as tone deaf, but it didn’t stop the company from continuing to grow and succeed. Neither did the coronavirus lockdowns – in fact if anything, the brand received a boost.
When gyms and other fitness-based businesses were closed (alongside many public parks and hiking trails) around the country, it was devastating for those businesses.
Large companies were forced to pivot into the exact virtual fitness niche Peloton paved. Having a pre-built platform (and audience) boosted Peloton’s value, but it’s also now competing in a crowded market against some big players.
Zoom Video Communications (ZM) Blew Up
Zoom [ZM] became a media darling in 2020, more than doubling in value as its user base skyrocketed.
This video conferencing platform became the du jour tool of the COVID-19 lockdowns, as schools, businesses, churches, governments, and more went virtual.
Its ability to easily connect up to 49 on-screen videos and 1,000 participants in a video conference pushed it past offerings from tech giants like Microsoft (Skype), Google (Hangouts), and Facebook (WhatsApp/Messenger).
That spotlight came with 300 million users and a lot of security concerns. For one, the company’s transparency has been called into question.
Even the user counts are a bit skewed. On top of this, its calls were found not to be encrypted end-to-end, leaving openings for participants to Zoom bomb, a term coined to describe breaking into someone else’s meeting.
Zoom is steadily gaining, but a flood of established competitors creates a rough road with constant price movement. Look no further than meet.google.com to see bumps in the road up ahead for Zoom. For day traders that kind of volatility creates ample opportunities to scalp profits (or losses!).
Amazon.com (AMZN) Is A Rollercoaster
Amazon [AMZN] is a behemoth these days, with business in e-commerce, cloud computing, digital streaming, and more. Many successful digital companies rely on Amazon services, and with over 150 million paying Prime subscribers, it’s unmatched in its revenue earnings.
And the coronavirus lockdown only made the company stronger.
Municipality lockdowns nationwide led to increased reliance on Amazon’s offerings. It experienced a much milder hit than most and immediately jumped in value, as income poured in from quarantined customers worldwide.
Amazon now has the power to pick and choose which businesses it wants to save among the wreckage of COVID-19.
That doesn’t mean the company is invincible though, and backlash against the company’s working conditions is growing. Amazon’s workers took part in several strikes in April and May, while employees continue contracting the coronavirus.
Roku (ROKU) Balloons Higher, Crashes Lower
Roku [ROKU] is one of the new class of TVs. This smart TV platform gained big over competitors like the Fire TV and Chromecast. As the market leader, it controls 39% of the O.T.T streaming market but commands 59% of programmatic ads. Like Amazon, he coronavirus lockdown only strengthened Roku’s hold on its userbase. Roku also has plenty of cash on hand and is still looking to raise more.
Still, it’s not fully immune to the effects. Ad revenue declined, as many brands cancelled video campaigns they could no longer afford. Hollywood productions also ground to a halt, leaving an impending gap in content by the end of 2020.
This gives Roku a lot of obstacles that will surely make it as volatile as ever moving forward.
Each of these five stocks can make serious gains for investors, but you need to know when to put your money where to make it happen. The long-term prospects differ for each of these investments. But in the short term, they’re here to shake things up and keep investors watching their fast movements.
The author has no position in any of the stocks mentioned. Financhill has a disclosure policy. This post may contain affiliate links or links from our sponsors.