The recent catapult comes after the stock fell to an all-time low of $12.15 on September 23. The stock is currently trading at $36.30 per share.
Trump Media and Technology Group (TMTG) is the parent company that owns Truth Social, the emerging social media platform that former President Donald Trump founded when he was kicked off mainstream websites after the attack on the Capitol United States on January 6, 2021, and his refusal to admit that he lost the 2020 Presidential election. The stock is traded on Nasdaq below DJT logoreflects the initials of Donald John Trump.
Despite the recent recovery, TMTG’s financial results remain lackluster. In the first half of this year, the company reported a loss of $344 million on revenue of $1.6 million. However, over the past few weeks, the stock’s momentum may have attracted interest from momentum investors looking to cash in on the stock’s growth.
“The extremely high trading volume compared to the public float shows that many traders, both individuals and institutions, are pursuing strategies that create short-term momentum”. “These traders contribute to volatility, when the tide changes, many of them move in the same direction. Falling stock prices cause others to sell, causing the stock to fall in price. When stocks go up in price, they buy them, pushing the price higher.”
There are many colorful names for short-term momentum investors. So-called sharks trade aggressively in search of quick profits; piranhas describe the thrill of such traders. Cheetahs are high-frequency traders and those in the group will monitor trades once they have started.
TMTG’s trading volume in October was very large, with hundreds of millions of shares changing hands. Last week, more than 278 million shares were traded on the market, according to Bloomberg data. Last week 194 million shares were traded.
Still, it’s impossible to separate the surge in TMTG stock from Trump’s political fortunes. Stocks typically trade independently of the fundamentals associated with its business.
“The increase in DJT corresponds to the increase in the number of people voting in favor of Donald Trump winning the presidential election,” Ritter said.
In recent weeks, election polls have shown a narrow margin for Vice President Kamala Harris over Trump. The race now appears to be nearly tied, with Trump having a slight edge in certain forecasts. On Monday, Economist announce it election forecast Trump has a 54% chance of winning the race. Silver Natefounder five thirty eightsaid that while the race was 50-50, he saw Trump win.
TMTG is considered a meme stock, meaning it trades for reasons that have nothing to do with business and financial metrics. Instead, it often functions as a means for people to express their political support for Trump.
in one SEC filing As of June, TMTG had an estimated 620,000 shareholders, “the majority of whom are everyday retail investors.” According to George Kailas, CEO of Prospero.ai, an online trading platform, the influence of certain dedicated investors, many of whom are avid fans of Trump, is not at the right time. always reflect the true state of the company because they often operate in echo chambers. .
“They surround themselves with Trumpers, eliminating people from online communities who don’t pass purity tests,” Kailas said. “Then they believe he can’t lose because they think most people agree with them.”
