Trump stocks DWAC and Rumble are surging? Is it safe to buy?

Stocks associated with Donald Trump are surging as investors cheer his performance at Iowa and his potential gains in New Hampshire. Rumble (RUM) stock price surged by more than 36% on Monday and by over 20% in the pre-market session. It spiked to $5.90, which was over 76% from its lowest point this year.

Why Rumble and DWAC are surging

Meanwhile, Digital World Acquisition (DWAC) share price has risen in the past six days. It rose by over 88% on Monday after Ron DeSantis dropped from the presidential race and endorsed Trump. It has risen from below $20 to $50, its highest point since May 2022, giving it a market cap of over $1.85 billion. 

The two stocks will be in the spotlight on Wednesday as the results from New Hampshire come in. Most analysts believe that Trump has an upper hand in the state. The final poll showed that he had a 60% chance of the votes compared to Haley’s 38%. If he wins the state, many analysts believe that it will end Haley’s run in the primary. 

Therefore, DWAC and Rumble stock will likely do well because they are associated with conservatives. DWAC is attempting to take Trump’s Truth Social platform public while Rumble is a YouTube rival that promotes free speech.

Rumble stock price also jumped after teaming up with Barstool Sports, the company started by David Portnoy. The partnership will provide Rumble users access to its sport content on its platform. It will also have an advertisement element while Barstool Sports will leverage Rumble’s cloud computing platform.

Rumble and DWAC investors believe that their platforms will see more engagement during the ongoing campaign season. As ad-supported platforms, these companies will likely benefit as more users visit their platforms.

Chasing the DWAC and Rumble rally has risks

However, as I warned last time, hype-driven stock bull runs don’t last for long. We saw that with the performance of companies like GameStop, AMC, and Blackberry. After surging hard during the meme coin frenzy in 2021, all of them have crashed hard. 

While TruthSocial will see more engagements, the challenge will be on how to monetize it. So far most big advertisers like Unilever, Procter & Gamble, Abbvie, and GSK have avoided the platform because of its small size and its polarizing nature. 

Most importantly, most people who believe in free speech have a home in Twitter, which has welcomed controversial people like Alex Jones.  Therefore, chasing the ongoing rally in both DWAC and Rumble could be risky.