One of the more impressive movers in the market in April has been Aterian (NASDAQ:ATER). As of April 1, shares of this consumer products platform traded just below $2.50 per share. Fast forward less than two weeks, and ATER stock has surged to about $6 per share at the time of writing. Today, this stock is currently up more than 20% on heavy volume.
Like many other popular meme stocks, Aterian surged to more than $40 per share in last year’s mega-rally. However, since then, most of the meme stocks that soared have fallen back to earth. Unfortunately for speculators, what goes up far too rapidly often comes crashing back down. The financial world has its gravity, of sorts.
That said, this recent rally, which has seen ATER stock more than double in less than two weeks, is impressive. Let’s dive into what’s behind this recent rally.
ATER Stock Surges Again
Momentum stocks have been fickle creatures over the past year. With speculative momentum waning as investors focus on de-risking their portfolios, many stocks such as Aterian have had a rough go through early 2022.
That said, Aterian’s status as a potential short-squeeze candidate is the primary focus of many investors. This stock made last week’s list of short opportunities put forward by Fintel. In fact, this stock took top spot on the list, mainly due to the high borrow fee rate of more than 60% and more than 30% of the stock’s float shorted.
Given Aterian’s stock price, options investors are able to get more bang for their buck with options contracts to trade short-term swings. In combination with these other factors, it’s clear that Aterian is a favorite of scalpers and swing traders looking to pick up quick returns.
For longer-term investors, the story with Aterian is an interesting one but not necessarily one that’s likely to generate outsized interest. Accordingly, I view ATER stock as more of a trading vehicle for speculators than anything else right now.
On the date of publication, Chris MacDonald did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.