The Rise of the Musk Trade: How Elon Musk’s Empire Has Surged During the Trump Era

Introduction: The Shift from the Trump Trade to the Musk Trade

The 2024 U.S. presidential election brought about a significant shift in the financial markets, with assets tied to former President Donald Trump initially experiencing a surge. This phenomenon, dubbed the "Trump trade," saw stocks and cryptocurrencies like Dogecoin rallying in the immediate aftermath of the election. However, the momentum fizzled out as the administration’s policies, particularly on tariffs, proved less decisive than anticipated. Meanwhile, a new investment trend emerged: the "Musk trade." Elon Musk, the world’s richest person, has seen his net worth and the valuations of his companies soar since the election, with his net worth increasing by a staggering $135 billion as of late November. This article explores how Musk’s various ventures, including Tesla, Dogecoin, X (formerly Twitter), xAI, and SpaceX, have reaped significant benefits from this trend, making the "Musk trade" the more enduring and lucrative investment strategy.

Tesla: Leading the Charge in Electric Vehicles

Tesla, Musk’s flagship company, has been a standout performer since the election. Despite a choppy year overall, Tesla’s stock price has surged by 42% since November. This growth is attributed to Musk’s ambitious 2025 plan, which includes the rollout of a network of automated Cybercabs in Austin and a renewed focus on vehicle sales growth. Additionally, the Trump administration’s rollback of Biden-era tax credits for electric vehicles (EVs) has created a challenging environment for Tesla’s competitors, further solidifying Tesla’s position in the market. As the EV industry continues to evolve, Tesla remains at the forefront, leveraging its innovative technology and strategic planning to maintain its dominance.

Dogecoin: The Meme Cryptocurrency’s Resurgence

Dogecoin, the Shiba Inu-inspired meme cryptocurrency, has also benefited from the "Musk trade." Since Trump’s election victory, Dogecoin’s value has surged by about 60%. Musk’s public endorsement of the cryptocurrency, which he has referred to as his favorite, has played a significant role in its resurgence. The broader enthusiasm for meme coins, fueled by the polarizing nature of both Trump and Musk, has further accelerated Dogecoin’s growth. The cryptocurrency’s rally highlights the influence of high-profile figures on market trends, particularly in the volatile world of digital assets. As the market continues to evolve, Dogecoin’s performance serves as a testament to the power of social sentiment and celebrity endorsements in driving investment trends.

X: Reversal of Fortunes for Musk’s Social Media Platform

X, formerly known as Twitter, has experienced a reversal of fortunes since Musk’s acquisition. The banks that financed the deal have managed to offload $4.74 billion worth of debt at face value, a significant improvement from the challenging situation they faced in 2022. This turnaround is supported by X’s financial performance, which showed earnings before interest, taxes, depreciation, and amortization (EBITDA) of $1.2 billion in 2024, unchanged from the pre-acquisition period. Additionally, major advertisers such as Apple, Amazon, Robinhood, and Temu have returned to the platform, signaling a recovery in revenue. As X continues to navigate its post-acquisition landscape, the company’s ability to attract advertisers and manage its debt effectively will be crucial to its long-term success.

xAI: Musk’s Foray into Artificial Intelligence

Musk’s xAI, a direct competitor to OpenAI, has also benefited from the surge in investor interest. The company is reportedly in talks to raise $10 billion at a $75 billion valuation, representing an 88% increase from its $40 billion valuation in December. This rapid growth underscores the growing importance of AI in today’s tech landscape and Musk’s ability to capitalize on emerging trends. With a massive AI data center under construction in Memphis, xAI is positioning itself as a major player in the AI race. According to Ross Gerber, CEO of Gerber Kawasaki and a longtime Tesla investor, Musk’s focus on AI is a strategic move that leverages his strengths as an entrepreneur and innovator.

SpaceX: Reaching New Heights

SpaceX, Musk’s space exploration company, has also seen its valuation soar since the election. In December, the company sold shares at a $350 billion valuation, a 67% increase from its previous valuation of $210 billion. This growth is driven by the success of Starlink, SpaceX’s satellite internet division, which has secured deals with companies like T-Mobile and the Italian government. The latter is considering a $1.6 billion contract for secure telephone and internet services via Starlink. As SpaceX continues to expand its operations, both in the U.S. and internationally, its valuation is expected to grow further, solidifying its position as a leader in the space industry.

Conclusion: Musk’s Pivotal Role in Shaping the Investment Landscape

The "Musk trade" has emerged as a defining investment trend in the aftermath of the 2024 presidential election, outperforming the initial "Trump trade." Musk’s diverse portfolio of companies, including Tesla, Dogecoin, X, xAI, and SpaceX, has seen significant growth across the board. Tesla’s dominance in the EV market, Dogecoin’s resurgence, X’s financial recovery, xAI’s rapid expansion, and SpaceX’s soaring valuation all highlight Musk’s pivotal role in shaping the investment landscape. As the world continues to grapple with technological advancements and economic shifts, Musk’s ability to innovate and adapt will likely keep him at the center of the financial universe. Whether through electric vehicles, artificial intelligence, or space exploration, Elon Musk’s empire is poised for continued growth, making him one of the most influential figures in modern business.