EXCLUSIVE: Trump Victory Triggers 'Reshoring' Rally As Supply Chain Security Outweighs Cost

Following Donald Trump‘s election victory, stocks of companies focused on reshoring production to the U.S. surged sharply this week, driven by expectations of more protectionist policies.

The American Reshoring ETF RSHO—a fund investing in 30 companies committing to reshoring their production lines back home—jumped over 8% in the week, outpacing broader market indices. The SPDR S&P 500 ETF Trust SPY was up 5% and on par with the iShares Russell 2000 ETF IWM.

Why Expert Sees A Reshoring Boom Ahead

Trump’s win has reignited investor optimism around reshoring, with policies likely to push U.S. companies to prioritize domestic production over cheaper overseas options.

"The case for reshoring is now well set with the Trump presidency," said Maurits Pots, CEO of Tema ETFs, in an exclusive Benzinga interview.

The new administration is expected to support trade protectionism and tariff increases, a strategy Maurits emphasized as a "key driver of reshoring and domestic manufacturing growth."

"Companies used to think about what was my lowest cost of production," Pots said. "Now they're asking, ‘where can I get more secure, closer-to-home production?' Security in supply chains is increasingly outpacing cost in importance," he added.

This shift towards U.S.-centered manufacturing appears to reflect market anticipation that the administration will implement policies with a "primarily U.S. focus," especially after the potential of a red sweep.

Heavy equipment manufacturers, often seen as bellwethers for industrial sentiment, were among the big winners this week. Caterpillar CAT rose more than 8% post-election, signaling investors' heightened interest in U.S. industrial stocks.

Maurits highlighted a similar trend with equipment companies, such as Terex Corp. TEX .

He noted that these stocks "had very strong moves recently, indicating that expectations of a reacceleration in American capex will be a focus point for the administration."

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Trade Policies: Tariffs, Subsidies, And The Mexico ‘Nearshoring’ Risk

"We believe tariffs may ultimately prove less harsh than threatened," said Pots, "but the mere uncertainty around tariffs will itself already form a catalyst for reshoring as companies increasingly value supply chain security and stability."

According to Pot, the Trump administration's stance could also discourage "nearshoring" — the trend of moving production closer to the U.S., but not quite on its soil, such as to Mexico.

With Trump's proposed tariffs on Mexican goods, Mexico's appeal as a manufacturing hub may diminish, further driving interest in truly domestic production.

Interestingly, Pot highlighted that most of the reshoring incentives introduced during the Biden administration, including substantial investment packages like the CHIPS Act, have been concentrated in Republican-led states.

This aspect of the fund distribution could protect these initiatives from potential rollback under Trump, as they align with his administration's agenda of strengthening U.S. manufacturing.

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