Non-fungible tokens (NFTs) are the new hot thing to invest in. People are spending millions to buy NFTs of digital works of art and other items that live on blockchain. It’s an expensive price tag, especially for a digital item that may not have much use to a person besides them turning it around hoping to re-sell it at a higher price later. But that’s the type of speculation that has fueled the stock market since the pandemic, and so it’s no surprise that stocks that could benefit from this new NFT trend have also been doing well.
Takung Art Co (NYSE American:TKAT) is a great example of that. Despite only recording $4.6 million in revenue last year along with an operating loss of $1.6 million, shares of the stock have soared 2,000% thus far in 2021. But it isn’t the company’s results that have investors bullish on the stock.
It’s that Takung has an online trading platform where art collectors can buy and sell works of art. Although the company hasn’t made an announcement that it will enter the NFT space, that hasn’t stopped speculators from betting that it will. Its online platform, could, after all, be a great fit for that new trend.
However, right now there are no guarantees of that happening much less a forecast of how much Takung might generate if it does make a move. This is as speculative as speculative gets and before you decide to think about jumping on this ultra-hot bandwagon, you should carefully consider the risks as this is a stock that has plenty of room to fall if this trend fades or the company squashes the NFT idea.