So I've been thinking about the whole meme stock thing, and there's actually something pretty interesting about how people talk about diamond hands versus paper hands that doesn't quite match reality.

You probably remember when Beyond Meat went absolutely insane back in October. The stock exploded nearly 1,400% in less than a week after they converted a ton of debt into new shares. Everyone on Reddit and Twitter was talking about it being heavily shorted, and suddenly you had this massive wave of retail traders jumping in.

Here's where it gets weird though. Everyone talks about diamond hands like it's this powerful strategy where you hold no matter what and that's how you win. But if you actually look at the trading data from that Beyond Meat peak on October 22, something doesn't add up. The stock was trading 2.22 billion shares that day. That means each share was literally changing hands more than five times on average. So yeah, some people had diamond hands, but the vast majority were the opposite of diamond hands - they were paper hands looking to make a quick flip and get out.

This has been the pattern with basically every meme stock. GameStop, AMC, even Opendoor this summer. The volume spikes like crazy, which tells you most people are trading short-term, not holding.

Now here's the thing - diamond hands actually does work, just not the way most people think. It's not about holding meme stocks. Those companies usually have terrible fundamentals anyway. Beyond Meat's a perfect example - unprofitable, declining sales, broken business model. That's not something you hold through thick and thin.

But diamond hands is absolutely the right move with quality growth stocks. Look at Nvidia. That stock dropped over 50% twice in the last decade and fell about 35% earlier this year. If you sold during any of those crashes, you'd have missed out on massive gains. That's where diamond hands actually matters.

So the real lesson isn't that diamond hands is wrong. It's that you need to apply it to companies that actually have something going for them, not struggling retailers converting debt into shares. That's just common sense.