DORK - The "most dazzling" term in the US stock market

In the U.S. stock market, the term DORK is becoming the latest synonym for retail investor speculation frenzy.

DORK concept stocks, a new Meme stock combination formed by the initial letters of the stock codes of companies like Opendoor (OPEN), Kohl's (KSS), Krispy Kreme (DNUT), and GoPro (GPRO), once again showcase the power of retail speculation.

On Monday, Opendoor surged 43% in a single day, Krispy Kreme soared 39% at one point, and GoPro jumped 73% in a short time, as the market attempted to replay the "Meme stock frenzy" of 2021. However, these gains quickly faded, with Opendoor closing down over 20% on Wednesday, Kohl's retreating 14% from Tuesday's high, and Krispy Kreme dropping 27% from its peak.

According to Vanda Research data, retail investors net purchased $155.3 billion in stocks in the first six months of this year, setting a record high for at least a decade, indicating strong speculative sentiment.

However, Wall Street generally believes this will not pose a threat to the overall market. The S&P 500 index rose 1.5% this week, reaching a new all-time high, primarily supported by strong corporate earnings and economic data, rather than speculative sentiment.

DORK Concept Stocks "Flash in the Pan"

The DORK concept stocks that became the focus this week generally showed weak financial performance, indicating that trading behavior was more driven by speculative psychology rather than fundamental analysis.

Market data shows that Opendoor, which triggered this round of Meme stock frenzy, saw its revenue decline by 26% year-on-year last year, with a net loss of $392 million. GoPro also performed poorly, with a 20% drop in revenue last year and a net loss of $432 million.

Art Hogan, Chief Market Strategist at B. Riley Wealth Management, commented:

“These are basically companies that are indeed impaired, if not completely bankrupt.”

Michael Brown, Senior Research Strategist at Pepperstone, stated that the retail enthusiasm for these fundamentally poor stocks clearly indicates that investor sentiment is approaching "frenzy levels."

Influencer Stock Trading May Have Become the Norm

The DORK craze signifies that Meme stocks may have shifted from being a "rebellious symbol" in 2021 to becoming "everyday market elements."

Compared to the Meme stock frenzy of 2021, this week's DORK craze shows significant differences in market structure and duration; in fact, this round of speculation lasted only one to two trading days before quickly fading, with relatively little coordinated action in the options market.

In 2021, more than half of the top 100 stocks in the S&P 500 had a bullish options skew, while this week, that proportion reached a maximum of only 21%.

Garrett DeSimone, Chief Quantitative Analyst at OptionMetrics, pointed out that market makers and institutional investors have truly adapted to this phenomenon, "being able to hedge risks and knowing how to price these options in various situations." Cboe Global Markets data shows that zero-day options contracts account for 62% of the total options volume for the S&P 500 this quarter, setting a record high, with more than half of the activity driven by retail traders.

Amy Wu Silverman, head of derivatives strategy at RBC Capital Markets, stated:

“This generation is much savvier about options and market structure than the previous generation. Our generation may have been taught to ‘buy houses,’ while this generation knows to ‘buy the dip.’”

Analysis indicates that this retail speculation is no longer a reflection of post-pandemic distortions or generational anxiety, but has become an everyday phenomenon integrated into modern market architecture.

Junk bonds, crypto assets... speculative funds are diversifying

Currently, retail speculative funds are flowing into a more diversified range of risk assets, with Meme stocks no longer being the sole target of speculation.

Since the sell-off in early April, Goldman Sachs' most shorted basket of stocks has surged over 60%. In the credit market, the riskiest CCC-rated junk bonds are expected to rise for the seventh consecutive week. Cryptocurrency funds have seen inflows of $12.2 billion over the past four weeks, setting a record for cumulative inflows during the same period.

Peter Atwater, a part-time professor studying retail investors at the College of William & Mary, stated that the current wave of activity reflects a shift in market sentiment and investment tools. Trading in Meme stocks has lost its novelty:

“We have normalized meme culture, and now we are tired of it.”

The most aggressive traders have turned to higher-risk frontier areas—digital tokens, leveraged ETFs, and gambling markets, with Meme stocks resembling a cultural replay.

According to Bank of America citing EPFR Global data, the U.S. leveraged loan market has just experienced its busiest week ever, with junk-rated companies repeatedly repricing their loans.

Analysis points out that the popularity of trading platforms for sports betting and complex stock wagers has made frenzied speculation occur “almost without any reason,” and this diversified risk appetite has diluted the focus on any single Meme stock