Chinese language traders are leaping right into a little-known inventory whose title seems like “Trump wins big” lower than per week earlier than the US presidential election.
Shares of Wisesoft Co., whose Chinese language title “Chuan Da Zhi Sheng” seems like “Trump wins big” to Mandarin audio system, surged by the day by day restrict for a 3rd day, bringing beneficial properties this week to greater than 30% regardless of weak spot within the broader market. The inventory rallied after Trump gained the election in 2016.
“Wisesoft’s name includes both Trump and him winning and that carries a special meaning for Chinese investors,” stated Shen Meng, a director at Chanson & Co. This comes amid election-related studies that bode nicely for Trump, he added.
Retail traders in China are identified for buying and selling in shares primarily based on homophones — phrases that sound much like one other title or a phrase. In 2023, retail merchants chased shares with dragon-related names heading into the Yr of the Dragon within the Chinese language zodiac.
The rally in Wisesoft comes as Trump emerges forward in prediction markets, whereas polls present a neck-and-neck race towards Democratic candidate Vice President Kamala Harris. Curiosity within the inventory has pushed it to overbought territory, primarily based on its 14-day relative power index.
The climb might not be sustainable given little change in basic help for the software program and gear maker. The corporate has been reporting losses in recent times and posted a wider internet lack of 27 million yuan ($3.8 million) for the primary 9 months of the yr in comparison with the identical interval in 2023.
“Historically, meme stocks don’t last long in China,” stated Billy Leung, an funding strategist at International X ETFs. Traders “tend to overplay it.”
