In the dynamic world of finance, the connection between major market players and rapidly evolving technologies often ignites enormous growthNo one epitomizes this phenomenon more than Elon Musk, the world’s richest individual and the driving force behind a consortium of groundbreaking companiesOver the past year, anyone who placed substantial bets on Musk-linked assets—including both large hedge funds and individual retail investors—has seen remarkable returns, further enriching Musk and amplifying the influence of his commercial empire.

Elon Musk's name has become synonymous with a powerful new wealth strategy in the U.Sstock market, as sought after as the so-called "Magnificent Seven"—a reference to dominant tech giants like Tesla, Nvidia, and Apple that have collectively shaped the market's recent landscapeThe impact of Musk’s "core role effect" within the government has significantly uplifted the value of his companies and any related enterprises

Major financial players like Destiny Tech, Baron Partners, and ARK Investment Management, led by the renowned Cathie Wood, have emerged as the biggest beneficiaries of this burgeoning market sentiment.

This rise can be attributed to Musk's vigorous support and his recent appointment as the Secretary of the newly established “Department of Government Efficiency,” which is pivotal for reforming the American federal landscapeThis role has positioned his companies—Tesla, private unicorn SpaceX, and AI powerhouse xAI—as sizzling hot assets globallySince November, these companies have seen their market caps soar, contributing to Musk's net worth crossing the unprecedented $400 billion threshold, a milestone in the world of wealth.

Among the significant stocks, Tesla stands out as the star performer in the U.Sand global markets since NovemberIts stock price has dramatically surged by more than 70%, resulting in a staggering market capitalization of around $1.3 trillion

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Just last Thursday, shares of Tesla closed at $418.10, eclipsing the high price targets set by major Wall Street firms such as Bank of America and Morgan Stanley, which had projected a target price of $400.

For investors bullish on Tesla and avid supporters of Musk, the announcement of Musk's leadership in the “Department of Government Efficiency” promises to revolutionize the narrative around Tesla and its future ventures in artificial intelligence, humanoid robots, and fully autonomous driving technologyThe long-standing grievances related to federal inefficiency and regulatory delays regarding Tesla's Full Self-Driving (FSD) and Robotaxi projects could be substantially alleviated, providing a much-anticipated transformation in oversight processes.

One noteworthy player in the market that has truly captured the essence of the "Musk trade" is a closed-end fund known as Destiny Tech100. This fund has exhibited exceptional performance, skyrocketing over 500% since November 5th and has been traded openly in a manner akin to an ETF in the U.S

stock market.

Records indicate that Destiny Tech100 focuses on venture capital investments in unicorn companies, with over a third of its holdings tied to SpaceXThis strategic position has drawn enormous attention from individual investors and several leverage-intensive hedge funds, with the fund’s trading price exhibiting jaw-dropping premiums relative to its underlying assets.

ETF strategist Todd Sohn from Strategas remarked on the trend, stating: “Musk obviously has strong ties to the government, so investors gravitate toward funds that can offer them quick access to companies associated with him.”

In addition to newer funds, traditional stock-picking funds like Baron Partners Fund have also reaped significant rewardsThis fund has achieved a return close to 40% this year alone, far outpacing the returns of the Nasdaq 100 and S&P 500 indices

Veteran fund manager Ron Baron, who helms the Baron Partners Fund at over eighty years of age, has long identified Tesla as his largest holding, comprising 40% of his portfolio, while increasing his stakes in SpaceX to a substantial 10% by November.

Another noteworthy narrative tied to Musk this year centers around ARK Investment Management, led by the well-known Cathie Wood, and her flagship product—ARK Innovation ETF (ARKK), which manages assets totaling around $7 billionDespite being in negative territory for the year as of October, ARKK has rebounded impressively with a 20% increase so far in 2023, largely thanks to gains amassed post-NovemberARKK has consistently held a strong position in Tesla, showcasing the manager’s unwavering faith in the electric vehicle giant.

Furthermore, the ARK Next Generation Internet ETF, which also boasts significant exposures to Tesla, Bitcoin, and associated digital asset firms, has risen by over 50% this year

Sohn has identified these ETFs as direct beneficiaries of the “Musk trade.”

Given the evolving dynamics of regulation under a newly positioned government, Tesla stands poised for significant benefits, especially in advancing the approval processes for its autonomous taxi service (Tesla Robotaxi) and FSD operation systemThere is also the prospect of the elimination of electric vehicle tax credits under the new administration, which Musk has stated could further advantage Tesla compared to its market competitorsNotably, SpaceX's revenue is heavily reliant on contracts with the U.Sgovernment, suggesting additional support could be on the horizon as the administration evolves.

Despite its valuation reaching $350 billion, SpaceX remains incredibly valuable, yet Tesla's impressive performance, with a market capitalization surging over $500 billion, has made it even more attention-grabbing

Additionally, Musk's AI startup, xAI, has seen its valuation more than double since its last funding round in May, reaching an astonishing $50 billion.

However, with remarkable growth comes potential risk, as some assets experiencing sharp increases often trade well above their intrinsic valuesFor instance, Destiny Tech100 carries an overall valuation of $800 million, the highest since April, with its trading price exceeding ten times the latest reported net asset values, resulting in an extraordinary premium among similar closed-end funds.

Data compiled by institutional analysts shows that the Baron Fund has ranked in the top 1% among its peers over the past monthAlthough heavily concentrating investment in a single stock can prove counterproductive, this aggressive strategy has turned around what was previously an underwhelming performance for the fund this year.

Bloomberg Intelligence analyst David Cohen reflected on the “super turnaround” experiences of the Baron Fund and ARK, noting, “I can’t say this is common