A year after Donald Trump's return to the White House, the once-popular "Trump Trade" is facing severe setbacks. Assets that were expected to perform well during his presidency, particularly stocks and cryptocurrencies directly linked to Trump and his family, have plummeted, causing significant losses for some investors.
Since Trump's inauguration, shares of Trump Media & Technology (DJT), which operates his social platform "Truth Social," have plunged by 75%. Meme coins named after Trump and First Lady Melania have dropped by 86% and 99%, respectively, since the inauguration. Another cryptocurrency project tied to the Trump family, a token called "World Liberty Financial," has also declined by about 40% since its September launch.
These assets, directly associated with the president and his family, have been hit hard amid a broader sell-off in the market's most expensive and speculative corners. The downturn has also affected risk assets ranging from Bitcoin to AI darling CoreWeave.
Initially, investors anticipated that a Trump administration would bring deregulation, tax cuts, and crypto-friendly policies, driving related assets higher. However, as attention shifts from political prospects to actual corporate performance—and concerns over global trade policies grow—the once-optimistic outlook has reversed.
**Speculative Frenzy Fades, Linked Assets Tumble** The sharp decline in Trump-related assets coincides with a broader cooling of speculative market enthusiasm. Nick Giorgi, chief equity strategist at Alpine Macro, described it as "a healthy correction after a speculative frenzy," noting that portfolios tracking meme stocks, retail favorites, unprofitable tech firms, and momentum plays have all suffered heavy losses over the past month.
The cooling sentiment extends beyond Trump's business ventures. A Goldman Sachs basket of unprofitable tech stocks, which surged earlier this year, fell 21% between mid-October and November 21.
Trump Media & Technology is among the meme stocks hit hardest recently. According to FactSet, the company trades at a staggering price-to-sales ratio of 1,240x.
The market shift has caught some retail investors off guard. Last month, a Reddit user identifying as a "DJT holder" revealed he bought the stock at $46, only to see it drop to $11.07. He lamented, "When should I give up and move on?"
**Mixed Performance in Macro Trades** The broader "Trump Trade" strategy presents a mixed picture.
Some sector bets have played out as expected: healthcare stocks have risen, European defense stocks initially surged, clean energy firms struggled, and Wall Street giants like Goldman Sachs performed well.
However, regional banks lagged due to concerns over economic slowdowns and tighter credit conditions. Meanwhile, major private prison stocks, after a post-election rally, have also tumbled in 2025.
In alternative assets, gold emerged as a winner. Fears over the dollar's future and demand for market turbulence hedges drove inflows, pushing gold prices to repeated record highs this year. The metal now trades near $4,200 per troy ounce, up nearly 60% year-to-date and close to its October peak.
Conversely, Bitcoin has faced a brutal sell-off since October, dropping 30% in less than two months. The crypto market turmoil has also impacted Trump's business ventures, which are deeply involved in the sector.
Bob Elliott, CEO of Unlimited Funds, noted that while concentrated crypto investors "are feeling significant pain, the macro impact appears quite limited," suggesting contained systemic risks.
**Market Focus Shifts to Inflation and Rates** Looking ahead, investor attention will turn to next week's release of the Federal Reserve's preferred inflation gauge—the Personal Consumption Expenditures (PCE) index.
Following recent Fed commentary, traders widely expect a rate cut at December's meeting. Lower rate expectations have helped stabilize equity sentiment.
Despite heightened volatility this fall and cautious valuations of some big tech firms, the S&P 500 has shown resilience, rebounding from each sell-off and now sitting less than 2% below its all-time high.
Meanwhile, shorting long-term U.S. Treasuries has been a profitable bet, as deficit concerns keep yields elevated amid geopolitical and growth uncertainties.
The U.S. dollar, however, has weakened broadly, partly due to worries that planned tax cuts and other policies could exacerbate deficit spending.
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