The Meme ETF is back. Is it still late for the party?

Roundhill Investments resurrected an exchange-traded fund focused on meme stocks on Wednesday, aiming to give ordinary investors an easy way to play the new class of stocks that are both dynamic and volatile.

But if history repeats itself, it could mean that trading – and the broader market – is already losing momentum.

Roundhill said the Meme Stock ETF, which relaunched Wednesday, trades under the ticker MEME. This is the same ticker the company used for its previous meme-focused ETF, which launched in late 2021 before closing two years later.

“Meme stocks started as a rebellion but became a revolution,” said Dave Mazza, CEO of Roundhill Investments, in a press release. “With MEME, we give investors a tool to capture that power through an actively managed ETF that can quickly pivot into the stocks that dominate the conversation today.”

His previous execution offers a cautionary tale. The ETF went live in early December of the same year, just as the Nasdaq Composite reached a peak. From the ETF’s launch in 2021 until the announcement that it would close at the end of 2023, the Nasdaq fell almost 10%. The wide S&P500 lost more than 3% during this period.

Well-known meme stocks have fared much worse. Stoppage of play plunged about 69% during this period, while AMC cratered by more than 96% in almost two years.

“Meme stocks contributed much of the exuberant 2020-2021 market sentiment, ultimately leading to a cyclical peak,” Jonathan Krinsky, BTIG chief market technician, in a note to clients Wednesday highlighting the irony of the stimulus.

Krisnky added that the meme fund launch was an indicator of market froth “reaching fever pitch.” The relaunch of Roundhill can be seen as “another sign of a certain exuberance”, he warned.

Certainly, the new iteration of the fund reflects the new generation of meme stocks. During the Covid stock craze, Reddit user “Roaring Kitty” and followers of the WallStreetBets forum led stock squeezes in GameStop and AMC, among other names.

In today’s fund, Open door technologies is the largest stock with a plus weight of nearly 12%, according to Wednesday’s Roundhill data. The stock — which ended last year below $2 a share — has soared nearly 450% this year under the watch of hedge fund manager Eric Jackson.