Top ETF Winners from the Trump Trade

Trump’s major victory in the presidential election has sparked impressive rallies in U.S. stocks and other risk assets. The so-called "Trump trade" has boosted Bitcoin and cryptocurrencies, Tesla TSLA, the U.S. dollar, and small-cap stocks in particular.Investors appreciate clarity and certainty, which is why stocks tend to rise after elections. They also hope that lower taxes and reduced regulation will benefit the economy.Many investors have poured into areas of the market they believe will gain the most from the Trump trade. Many leveraged ETFs have garnered a lot of interest as traders seek to amplify their bets.Bitcoin has risen over 30% since the election, as Trump has promised to make the U.S. “the crypto capital of the world," ease regulatory burdens, and establish a reserve to hold the nation’s Bitcoin supply.Assets in the iShares Bitcoin Trust IBIT have surged to over $41 billion. Leveraged single-stock ETFs for crypto-related stocks like MicroStrategy MSTR and Coinbase COIN have also seen heavy trading and significant inflows.Tesla has surged more than 40%, adding over $300 billion to its market value amid speculation that CEO Elon Musk could have influence in the new administration. Furthermore, this relationship might facilitate the automaker’s ambitions for greater autonomy.Trump’s proposed tariffs and a stronger dollar could aid small-cap stocks, which have been underperforming. Additionally, a stronger economy and lower tax rates could stimulate consumer spending, further benefiting domestically focused companies.However, some of these trades may be overextended. Investors should also remember that long-term stock market returns are mainly driven by economic conditions and earnings growth. Currently, the U.S. economy remains strong, with inflation nearing the Fed’s target and earnings continuing to grow.To learn more, please watch the short video above.Want key ETF info delivered straight to your inbox?Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week.Get it free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Tesla, Inc. (TSLA): Free Stock Analysis Report MicroStrategy Incorporated (MSTR): Free Stock Analysis Report Coinbase Global, Inc. (COIN): Free Stock Analysis Report iShares Russell 2000 ETF (IWM): ETF Research Reports SPDR S&P Regional Banking ETF (KRE): ETF Research ReportsTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks