which measures retail investors’ behavior and sentiment, based on a sample of accounts that completed trades in the past month. Their interests have been shifting toward less volatile names and more stable holdings like shorter-term bonds, the firm said.

Ms. Hellmann, who started actively trading in the early days of the pandemic, said she was sticking with it, learning more and refining her approach as she goes along.

She often rises at 3 a.m. and turns on CNBC to begin plotting her strategy for the day, which involves studying stocks’ price movements, a process she compared to learning to catch a softball — watching its arc, then trying to figure out the physics of where it will land. “That is what I’m doing with price and volume,” she said.

Long a buy-and-hold investor, she began with roughly $50,000 — money that came from shares of ConocoPhillips that she inherited in 2014 after the death of her grandfather, who had been a propane salesman. Her approach has grown increasingly complex over the past two years: Last fall, she took a large position in an exchange-traded fund that bets against the price of natural gas — which has gone up as Russia’s invasion of Ukraine roiled energy markets.

“The war causing natural gas to spike up at a time when it seasonally comes down did not help me much,” she said.

Even so, she’s more than quintupled her money since early 2020, riding the strength of a rally that has the S&P 500 up nearly 80 percent since it bottomed out in March 2020, even with its recent fall.

Experiencing losses after a period of gains can be instructive, said Dan Egan, vice president of behavioral finance and investing at Betterment, which builds and manages diversified portfolios of low-cost funds and provides financial planning services.

“If you have a good initial experience with investing, you see this is part of it, it will be OK,” he said. “We get bumps and bruises that you need to learn what pain feels like,” he said.

Eric Lipchus, 40, has felt plenty of pain in his nearly two decades of full-time day trading — he owned options on Lehman Brothers, the investment bank that imploded during the financial crisis of 2008-9. Before that, he had watched his older brother and father dabble in the markets during the dot-com boom and bust.

“I have been on a roller coaster,” he said. “I am making OK money this year but it’s been up and it’s been down. It seems like it could be a tough year — not as much upside as in previous years.”

Challenging conditions like investors are now facing can get stressful in a hurry, Mr. Lipchus said. Right now, he’s keeping half his portfolio in cash — and is taking a fishing trip to the Thousand Islands in a couple of weeks to clear his head.

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No End to Whiplash in Meme Stocks, Crypto and More

Drew Austin, an entrepreneur and investor, invested heavily in cryptocurrencies and NFTs, including digital horses, digital sports cards and some digital art. He took a “substantial liquidity hit” when cryptocurrency prices crashed in May, he said. But he is not cashing out, because he believes these new assets are the future. Still, the volatility can be stressful. Unlike a stock exchange, these newer markets never close.

“There are nights when I go to bed and I think, Please, God, China, don’t mess this up,” he said using stronger language. “It’s 24/7. It never stops.”

Bitcoin’s volatile month — dropping by around 65 percent in May, recovering some and then falling further this week — has not swayed investor enthusiasm. A recent survey by The Ascent, a financial services ratings site, showed that Generation Z investors viewed cryptocurrencies as slightly less risky than individual stocks.

But they’re learning that wild price swings can happen over a single tweet. In February and March, when Elon Musk and his company, Tesla, embraced Bitcoin, its price soared. In May, when Mr. Musk tweeted that Tesla would not accept Bitcoin payments over concerns with its environment impact, its price dropped.

It jumped again this week when Mr. Musk suggested on Twitter that Tesla would again accept Bitcoin someday. (His tweets have also propelled Dogecoin, a joke cryptocurrency based on a meme about a Shiba Inu.)

The sustained appetite for risky bets has fueled companies, like Robinhood, that enable customers to trade stocks, options and cryptocurrencies. In January, Robinhood’s role in the trading of meme stocks landed it in hot water with Congress, state regulators and its customers.

The attention only turbocharged Robinhood’s growth: Revenue more than tripled in the first three months of 2021 compared with the same period last year. Robinhood plans to go public in the coming months.

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S.E.C. Chair Gensler Emphasizes Transparency in Markets

Gary Gensler is putting transparency in the markets and the need to understand the impact of new technology at the top of his priority list as the new chairman of the Securities and Exchange Commission.

“I think transparency is at the heart of efficient markets,” Mr. Gensler said during his first testimony on Capitol Hill as the nation’s top securities cop.

Mr. Gensler, speaking from his living room, appeared by video before the House Committee on Financial Services to discuss the S.E.C.’s response to the tumultuous trading in shares of GameStop in January. The massive run-up in the stock price of the video game retailer was fueled by small investors who bought its shares on Robinhood and other commission-free trading apps and banded together on social media to cause big losses for a hedge fund that had bet GameStop shares would fall. Some investors who bought shares of GameStop at the peak later lost money.

Mr. Gensler said the S.E.C.’s staff has been working on a report addressing the issues raised by the episode that will be released this summer. He also said new rules may be needed for brokerage apps that turn stock trading into a game or contest, a method called gamification.

the collapse of Archegos Capital Management, which caused more than $10 billion in losses for Wall Street banks, pushed regulators to consider whether traders should be required to disclose derivatives — the financial trading instruments that allowed Archegos to take massive positions in stocks without attracting attention. Archegos’s losses were mostly attributed to the firm investing heavily in total return swaps, a type of highly leveraged derivative that can give a trader exposure to a stock without actual ownership.

Mr. Gensler’s tenure got off to a rocky start after Alex Oh, his pick to serve as director of enforcement, had to resign just days after being named because Paul, Weiss, the big law firm she had worked for, was facing potential sanctions in a case in which she was heavily involved.

The hearing with Mr. Gensler was the third and final one focusing on GameStop and the frenetic trading in the markets held by the House Financial Services Committee. The first hearing on Feb. 18 was held when shares of GameStop were trading around $40 a share after falling from a high of $347 a share. Since then, the stock has soared again, rising nearly 300 percent to $160 a share.

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Trading Stock Tips on TikTok, Newbies Are Deeply Invested in Learning

But traders like Ms. Crum, who lives in Sunrise Beach, Mo., are making an earnest effort to do it right.

Every night, she meticulously compiles a list of the stocks she’s watching using different measures. One of them, an online tool called a volume scanner, filters out stocks that are being traded more or less than usual, which she believes can tip her off to a good bet. And she tries to mitigate her risk: Ms. Crum uses stop-loss orders, to sell a stock when it hits a certain price, and limit orders, which let investors set more specific instructions.

Like many other young traders, she’s big on sharing what she learns — usually in TikTok videos to her 163,000 followers. Ms. Crum posted one about candlestick charts, which illustrate the price range of a holding on a particular day. In another, she explained how to use relative strength index, or R.S.I., which measures price changes over time and can indicate when a stock might be oversold or overbought.

“I started out doing swing trades, an old reliable way to go about trading,” Ms. Crum said, adding that she’ll day-trade if she spots something that appears to be “an obvious winner.”

Like other young investors, she is riding a wave that would not be possible without the widespread adoption of commission-free trading in late 2019, which threw open the doors to those without deep pockets. Retail trading now accounts for roughly 22 percent of all trading volume, according to Piper Sandler, a financial services firm, up from 13 percent a year ago, when overall volume was also lower.

“There are days when I make 100 trades or more,” said Dan Knight, 26, a day trader who co-hosts a podcast about the stock market. “I would have never been able to trade with $7 commission fees.”

Mr. Knight’s podcast, “P.G.I.R.,” was recently among the top 50 business shows on Apple podcasts in the United States and ranked as the top investing show in early February, according to Chartable. Irreverent and sprinkled with profanity, every episode starts with a voice-over from the rapper Flavor Flav, and Mr. Knight is introduced as the Deity of Dips, while his co-host, Mitch Hennessey, goes by Hugh Henne — a nod to his grandfather’s first name and, playfully, to Hugh Hefner.

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How Small Market Investors Are Being Wooed by Companies

That has prompted a strategy adjustment. In addition to spending time communicating with analysts whose “buy” or “sell” ratings on the stock can move its price, Mr. Schreiber said, he has made a point of doing interviews on podcasts, websites and YouTube programs popular with retail investors.

“I think that they are, today, far more influential on, and command far more following in terms of stock buying or selling power than the mighty Goldman Sachs does,” Mr. Schreiber said. “And we’ve seen that in our own stock.”

Academic research suggests that over the longer term, it can be a competitive advantage for a company to have a patient base of investors who understand and believe in its strategy. Such a steady foundation makes it possible for executives to focus on longer-term strategic goals, rather than meeting the short-term metrics often dictated by Wall Street analysts, said Mr. Cunningham of George Washington University Law School.

Take Amazon. Its share price kept rising over the years, despite its skimpy and unpredictable profits and widespread skepticism from Wall Street. The individual shareholders who held Amazon stock bought into the vision of the founder, Jeff Bezos, and saw no problem with Amazon recycling its enormous cash flows back into the company rather than paying dividends. Many of those shareholders are now rich; someone who bought $1,000 worth of Amazon shares at the start of 2000 would be sitting on more than $4.3 million today.

Shares of Tesla, too, have exploded in recent years — a victory for its base of cultish followers, who believed in the company’s prospects despite years of losses. Over the past five years, Tesla shares have gained more than 1,300 percent, creating $640 billion in market wealth.

While some companies are pursuing the loyalty of small shareholders, others are pursuing their money. Several companies whose stocks climbed during January’s “meme stock” boom have taken advantage of the demand to issue new shares, turning trading enthusiasm into actual cash for the company. (Previously issued shares that are bought and sold in the open market don’t generate any new money for companies themselves.)

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The Start-Up Enemies of Wall Street Are Booming

“The infrastructure has gone to a whole other level,” said CJ MacDonald, founder of Step, a debit card provider aimed at teenagers. Introduced in September, Step quickly reached one million customers, partly from endorsements from social media influencers like Charli D’Amelio.

In December, Step raised $50 million in funding. The company was not looking for more money, Mr. MacDonald said. But investors started calling as soon as the app joined the top-downloaded finance app list shortly after it was released. The money came together in a matter of weeks, he said.

Investors are even clamoring to buy into broken deals. Plaid, which had agreed to sell itself to Visa for $5.6 billion last year, saw the deal unravel in January after facing antitrust scrutiny. Now the fast-growing company is in talks with investors to raise funding at a valuation near $15 billion, said two people with knowledge of the company who spoke on the condition they not be identified because the discussions are confidential. The Information earlier reported Plaid’s funding talks.

Sheel Mohnot, an investor at Better Tomorrow Ventures, said Plaid’s sale price to Visa was viewed as “so amazing” at the time. But now, with multiple fintech companies approaching $100 billion valuations, it looks low.

Some caution that the excitement has gotten far ahead of reality.

Robert Le, an analyst at PitchBook, pointed to the valuation of Affirm, which has a market capitalization of $20 billion, or roughly 40 times its annual revenue. That’s significantly higher than the value that investors typically assign to blue-chip financial services companies. American Express, for example, trades at just three times its annual revenue.

“I think it’s a little irrational,” Mr. Le said. “Over the long haul, some of these companies will have to come down.”

Some of the start-ups have already hit growing pains. Chime, a banking start-up, had a series of outages in 2019, leaving millions of customers with no access to their money for hours. Some Coinbase customers have said they were locked out of their accounts or experienced thefts of their money. And Robinhood faces nearly 50 lawsuits and multiple regulatory investigations after it halted trading for some stocks during a frenzy in “meme” stocks in January.

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Robinhood files initial plan to go public.

Robinhood, the stock-trading app, said on Tuesday that it had filed a draft registration to go public, joining a wave of financial technology companies that plan to list on the stock market or that have raised new funding.

The exact timing or price of the offering has not been set. Private market investors have valued Robinhood at roughly $12 billion and some have speculated its initial public offering could top $20 billion. It is working with Goldman Sachs on its offering, a person familiar with the company said.

Robinhood used a process known as filing confidentially that allows it to keep some details under wraps in the early part of going public.

Financial technology companies have been booming. Coinbase, a cryptocurrency start-up, is expected to list its shares in the coming weeks, with investors estimating that it could be worth as much as $100 billion. Stripe, a start-up that offers payment processing services, raised funding this month that valued it at $95 billion, making it the most valuable start-up in the United States.

stimulus checks to day trade.

But it paused those plans in January when a group of online traders banned together to drive up the stock prices of so-called “meme stocks” like GameStop, causing short-sellers to lose money and forcing the exchanges to halt trading of some stocks.

Amid the frenzy, Robinhood restricted the trading of some stocks, outraging many of its users and drawing nearly 50 lawsuits and multiple probes from regulators. Vlad Tenev, the company’s chief executive, was called to testify in front of Congress about the market frenzy and Robinhood’s role in it.

Despite the anger, the GameStop incident boosted Robinhood’s name recognition and led to more downloads of its app, which is popular because it charges no fees for stock trading. Robinhood has been criticized for making day trading into a gambling-like game, where investors don’t always understand the risk they are taking on.

Private investors have stood by the Menlo Park, Calif.-based company. During the frenzy, Robinhood raised two rounds of emergency funding totaling $4.4 billion in a matter of days.

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Payments Start-Up Stripe Surges to $95 Billion Valuation

The payments company Stripe is worth $95 billion after a new round of funding, making it the most valuable start-up in the United States.

The San Francisco and Dublin-based company said on Sunday that it had raised $600 million in new funding from investors including Sequoia Capital, Fidelity Management and Ireland’s National Treasury Management Agency. The investment nearly triples Stripe’s last valuation of $35 billion.

The funding comes amid a surge in the adoption of digital tools and services in the pandemic as more people live, work and make purchases online. That has fueled a wave of investment into, and eye-popping valuations at, tech start-ups, as well as a frenzy of highly valued initial public offerings. Investors have valued Airbnb, the home rental start-up that recently went public, at $123 billion. Roblox, a kids gaming start-up, saw its valuation soar to $45 billion when it went public last week.

Founded in 2010, Stripe builds software that enables businesses to process payments online. As more people have turned to online shopping in the pandemic, Stripe’s offerings have been in demand. It is the largest among a class of fast-growing, highly valued financial technology companies.

Stripe is now processing hundreds of billions of dollars in payments each year across 42 countries, Dhivya Suryadevara, Stripe’s chief financial officer, said in an interview. “We are in a hyper-growth industry and within that, the company itself is experiencing hyper-growth,” she said. Ms. Suryadevara declined to share specifics on Stripe’s revenue or growth.

Stripe has been considered a candidate to go public. Coinbase, another financial technology start-up, filed to go public later this month in a transaction that some expect could hit $100 billion. Robinhood, a stock trading app, has also seen its valuation surge in the pandemic.

Stripe said in an announcement that it planned to use the money to expand in Europe, including its office in Dublin. The company’s sibling founders, John Collison, 30, and Patrick, 32, were born in Ireland.

In a statement, John Collison, Stripe’s president, said the company would focus heavily on Europe this year. “The growth opportunity for the European digital economy is immense,” he said.

The company, which got its start working with start-ups and small businesses, will also invest in building more tools to help larger businesses handle payments. It counts 50 businesses that process more than $1 billion a year as customers.

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