Getty Images for Snap, Inc.

• Snap rallied as much as 7% on Monday after unveiling Spotlight, a new Snapchat feature set to compete with TikTok and Instagram Reels.
• The jump placed shares above the previous record-high set on November 6.
• The service will allow users to submit snaps to be featured in a reel of looping videos.
• Snap will incentivize submissions with more than $1 million in daily payouts through the end of the year, according to a press release.
• Watch Snap trade live here.

Snap soared as much as 7% on Monday after revealing a new Snapchat feature meant to compete with TikTok and Instagram Reels.

The service, named Spotlight, will show snaps submitted by users to be featured in a reel of looping videos. Content algorithms will try to match users with Spotlight videos that match their interests.

The reveal lifted Snap as high as $47.27 before shares pared gains. The rally placed shares above the previous record-high of $45.60 seen on November 6.

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Spotlight's introduction brings a major update to Snapchat's app and opens the service up to the hundreds of millions of people who use TikTok. Previously, Snapchat users would receive content from individual friends or videos published by media outlets and channels on its Discover page. Spotlight presents a middle ground, where everyday users' videos can be featured to Snapchat's nearly 250 million daily users.

Snap will incentivize users to submit clips to be featured in Spotlight with payouts totaling more than $1 million every day. Members looking to win a payout need to be at least 16 years old. The program will run through the end of the year and could be extended into 2021, according to a press release.

The feature will first be rolled out in the US, Canada, Germany, France, the UK, Australia, New Zealand, Ireland, Norway, Denmark, and Sweden. 

Snap traded at $45.94 as of 12:55 p.m. ET Monday, up 189% year-to-date. The company has 38 "buy" ratings, 11 "hold" ratings, and two "sell" ratings from analysts.

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