Momentum stocks popular with the retail crowd continued to slide on Tuesday, adding to their woes from the past week.

In that time, the iShares MSCI USA Momentum Factor ETF MTUM has wiped out roughly half of its advance from earlier this year, according to FactSet data. The ETF, the largest product that tracks the momentum factor, was up by less than 5% this year to date as of Tuesday's close.

The pain might be nearing its end, for now. But investors shouldn't expect companies like Palantir Technologies Inc. (PLTR), AppLovin Corp. (APP) or Hims & Hers Health Inc. $(HIMS)$ to immediately bounce back to their record highs from earlier this month, said Farzin Azarm, a managing director with Mizuho Securities USA. All three stocks have been hit hard over the past few trading sessions.

"The day is coming where you're going to get a proper selloff, and it's going to take a lot of people with it," Azarm told MarketWatch late last week, as the momentum crash was starting to accelerate.

But what exactly would lead to this kind of a wipeout? According to Azarm, retail traders have increasingly been using margin - that is, money borrowed from their brokers - or leveraged products like options and leveraged ETFs to juice their returns. So when one trade backfires, they need to cut their exposure elsewhere to protect their capital or satisfy margin calls.

To be sure, others are more sanguine. Fundstrat's Tom Lee said Monday that the selloff in momentum names was "just a flesh wound," and that investors shouldn't fret.

On the surface, it appears each of these stocks is selling off for their own reasons, said Danny Kirsch, head of options trading at Piper Sandler.

For Palantir, it was a headline late last week that the Trump administration was planning steep cuts to the Pentagon's budget. AppLovin - which had become the market's hottest large-cap stock over the past year - was falling in response to a short report published late last week by the Bear Cave. And Hims & Hers got whacked after an executive acknowledged during its Monday earnings call that it would need to shift away from selling popular GLP-1 drugs, now that the Food and Drug Administration has removed semaglutide from its shortage list.

"There's micro data that came out that affects a lot of these specific stocks, and it's all coalescing around the same time," Kirsch told MarketWatch.

Other popular momentum stocks have tumbled, too. MicroStrategy Inc. $(MSTR)$ slipped more than 11% on Tuesday, according to FactSet data. The stock, which has traded like a leveraged play on bitcoin (BTCUSD), has fallen by more than 30% since late last year. Those losses have mirrored a drop in the price of bitcoin, which has hit its lowest price since November.

Meta Platforms Inc. $(META)$, another stalwart of the momentum trade and a major holding in the MTUM ETF, has given up nearly half of its advance from a record-setting 20-day winning streak.