Merck (MRK)

Looking to win your class stock market game and searching for “top stocks” to invest in? Look no further than Merck—this pharma giant could be your ticket to dominating the competition. With a potential $40 billion acquisition of Seagen in the works, Merck is positioned to shake things up, making it a hot stock to consider for those high-risk, high-reward trades that could give you the edge you need in the stock market game. But remember, while this strategy is great for short-term wins, it’s not the kind of play you’d want for long-term investing.

Let’s break down why Merck could be a top stock for you to invest in now, especially if you’re all about momentum trading. If the Seagen deal goes through, Merck would be acquiring a biotech firm that specializes in cancer drugs—talk about major potential. Seagen has four approved drugs already and a solid pipeline of others in the works. That means if Merck lands this deal, they’re not just replacing future revenue, they’re also betting big on some of the most sought-after treatments in healthcare. And in the world of momentum trading, news like this is pure gold.

But there’s more to Merck than just this deal. Even without Seagen, Merck is still a powerhouse. One of its top drugs, Keytruda, is a cancer treatment that’s been crushing expectations, pulling in billions. Plus, its HPV vaccine, Gardasil, is growing fast, bringing in over $3 billion in just the first half of this year. While these products help make Merck a strong defensive play in the stock market—meaning it’s less likely to take a hit in an economic downturn—it’s Keytruda that really makes Merck stand out for short-term gains.

“Merck’s stock could be the game-changer for anyone looking to win their stock market competition,” says Jamie Callahan, an analyst at Bright Horizons Capital. “With the potential Seagen deal and strong existing product lines, Merck offers the momentum needed for those looking to make high-risk, high-reward moves.”

Now, let’s talk strategy. In a stock market game, short-term trading—like day trading or swing trading—is all about making quick moves based on momentum. That’s why Merck’s current positioning, with potential acquisitions and a booming drug pipeline, could give you a shot at big gains in a short time. But this strategy is risky. Stocks like Merck may surge on news of a big deal, but they can also crash if things don’t go as planned. Just take Seagen’s stock, which has already jumped 30% on speculation of a deal. If the deal falls through? Seagen’s stock will likely tank.

Momentum trading is perfect for short-term games, but not ideal for long-term investing. For that, you need a diversified portfolio. Diversification means spreading your investments across different companies and industries to reduce risk. A good example of this is investing in an S&P 500 index fund, which holds stock in 500 top companies, giving you broad exposure to the market. Long-term, this is how you build wealth and meet financial goals. It’s stable, and it doesn’t rely on the big highs and lows that come with riskier strategies.

So, while Merck could help you win your class stock market game, it’s not a stock you’d want to bet your entire future on. Big pharma companies, including Merck, face challenges ahead—like the Inflation Reduction Act, which could lead to price negotiations for top-selling drugs in the future. But for now, Merck’s mix of strong product sales, exciting new opportunities, and momentum make it a strong contender in the short-term stock market competition.

In the words of Evan Seigerman, an analyst at BMO Capital Markets, “Merck’s current position, especially if the Seagen deal goes through, offers one of the best short-term opportunities for those looking to make bold moves. But it’s important to remember, these types of plays aren’t for the faint-hearted.”

If you’re aiming to win big, Merck’s your stock. But don’t forget—once the game’s over, it’s time to switch gears and think about long-term strategies, where slow and steady (and diversified) wins the race.