Chinese investors show irrational enthusiasm for Trump ‘meme stock’

Sébastian SEIBT

2 November 2024 at 11:47 am·1-min read

An investor observes stock price figures at a stock exchange on September 27, 2024 in Hangzhou, Zhejiang Province of China.

The share price of a small Chinese company in financial difficulties has skyrocketed in recent days. The company's only real asset is its name: Wisesoft, which in Chinese sounds like the phrase 'Trump wins big'. Chinese investors are prone to buying shares solely on the basis of a company name.

Former US president Donald Trump’s influence looms large, and not just in the United States. In China, his name has prompted some people to make a quirky bet on the stock market.

The share price of a small company that makes air traffic control software, Wisesoft, doubled over the past month on the Shenzhen Stock Exchange, a gain at odds with the company’s lacklustre financial results. It recorded a loss of Є3.5 million, (27.04 million yuan), for the first nine months of 2024.

Wisesoft's attraction for local investors is in its name, phonetically close to the expression “Trump wins big”, notes Bloomberg News.

Homonyms everywhere

It's not the first time that Wisesoft's share price seems to be linked to Trump. At the end of June, the company’s shares surged in the wake of the debate during which Trump outperformed President Joe Biden, then still a presidential candidate. Stock traders also flocked to Wisesoft in 2015, when rumours of Trump's presidential candidacy began to gain momentum.

“The government also encourages people to invest in the stock market to contribute to the growth in GDP,” he adds.

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Homonyms everywhere

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