New York-based MicroAlgo (NASDAQ:MLGO) which began trading yesterday, is soaring over 30% in pre-market trading this morning and is one of today’s highest trending tickers on social media. A subsidiary of China-based WiMi Hologram Cloud (NASDAQ:WIMI), MicroAlgo creates “central processing algorithms” that are supposed to help companies improve their customers’ experience, recruit new customers and save money.
More About MicroAlgo
Before yesterday, MicroAlgo was known as VIYI Algorithm. WiMi Hologram Cloud has a 73% stake in MicroAlgo, which merged with Venus Acquisition Corporation, a SPAC. As a result of the merger, MicroAlgo became a publicly traded company. WiMi, a developer of augmented reality technologies, holds 63% of the voting shares of MicroAlgo.
Yesterday, on its first day of trading, MLGO stock climbed as high as $71.50 before ultimately closing at $4.10. The shares opened at $58.15 yesterday.
According to WiMi, MicroAlgo’s parent company, MLGO is able to increase “computing power without the need for hardware upgrades,” and carry out “lightweight data processing, and data intelligence services.”
MicroAlgo’s founder and CEO, Shuo Shi, said: “As a leading provider of central processing algorithm services, VIYI is in an ideal position for rapid revenue growth.”
MicroAlgo’s SPAC Merger And the Future of MLGO Stock
MicroAlgo merged with a SPAC called Venus Acquisition Corp. in a transaction that was completed yesterday. Venus originally financed the deal with $46 million from its trust.
At this point, MLGO’s huge volatility could make it a good name for traders to exploit. On the other hand, the shares may be too unstable for long-term investors to consider buying for now.
On Penny Stocks and Low-Volume Stocks: With only the rarest exceptions, InvestorPlace does not publish commentary about companies that have a market cap of less than $100 million or trade less than 100,000 shares each day. That’s because these “penny stocks” are frequently the playground for scam artists and market manipulators. If we ever do publish commentary on a low-volume stock that may be affected by our commentary, we demand that InvestorPlace.com’s writers disclose this fact and warn readers of the risks.
Read More: Penny Stocks — How to Profit Without Getting Scammed
On the date of publication, Larry Ramer 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.