đŁ Day traders riding the Musk effect in election aftermath
Day traders have gone on a buying spree, flocking to assets linked to Elon Musk following Trumpâs election win. The assets on their list include stocks and extremely volatile cryptos such as Dogecoin and MAGA-themed memecoins.
Elon Musk has always had a great influence over the crypto market, having caused dramatic price swings with simple tweets in the past. More recently, he became one of Trumpâs biggest supporters and a key figure toward the end of the former presidentâs campaign.
Following Trumpâs victory earlier this month, Elonâs companies have been big winners, recording massive booms in the trading market. Now, day traders have started to tap into assets linked to him and his companiesâstocks and cryptos.
đ¸ Traders are using DXYZ to get into SpaceX
The Destiny Tech100 ETF gives traders a chance to gain exposure to Elon Muskâs SpaceX stocks. SpaceX is an otherwise difficult asset to invest in as its shares donât trade on the stock exchange. However, the ETF holds a significant stake in the firm, which makes up 38% of its assets according to its filing. It also has significant holdings in OpenAI, Stripe, and Discord.
The ETF fund has high management fees of around 2.5%, and thereâs significant risk in holding shares of non-public companies. Somehow, these investors have found the opportunities good enough to overlook the risks.
In the words of Bloombergâs ETF analyst James Seyffart, âThe issue with DXYZ is that itâs a closed-end fund, which means thereâs no mechanism to bring the share price in-line with the NAV like there is for ETFs. Compounding things for this particular fund is that it holds a lot of private assets like SpaceX, which donât even have a publicly traded price or valuation.â
DXYZ differs significantly from traditional tech ETFs as it provides indirect access to private market gains that would otherwise require venture capital access.
