Investors are excited about Tesla (TSLA, Financial) following Donald Trump's election victory, as many believe that Trump's presidency will benefit Elon Musk's electric vehicle company. Since the U.S. election on November 5th, Tesla's stock has surged by over 39%, adding more than $300 billion to its market value. On Monday, the stock closed up approximately 9%, reaching $350 per share.
Market experts describe Tesla as a classic momentum stock, where shifts in investor sentiment can quickly amplify gains or losses. According to Steve Sosnick, Chief Strategist at Interactive Brokers, the market views Tesla as a beneficiary of Trump's win because Musk supported Trump's campaign wholeheartedly. The enthusiasm is further fueled by investors buying on dips, chasing rallies, often using leverage or options, and the impact of the "insane mode" of growth.
