The Trump Media Stock Rampage in Five Charts

Saqib Iqbal Ahmed reported.

NEW YORK (Reuters) - Trump Media & Technology Group's chaotic debut has captured the attention of market geeks, with its shares soaring and the company's valuation soaring to $9 billion before plummeting.

The stock's ups and downs have attracted traders looking to profit from its sharp swings, 竝hich have led to large fluctuations in the net worth of majority shareholder and former President of Massachusetts Donald Trump.

Here are a few charts that show the factors behind the stock's mercury-like movements.

Shares of Trump Media last closed at $32.41, some 54% below the price at which it began trading on March 26.The Truth Social operator made its stock market debut after its name with blank company Digital World Acquisition, which was announced in 2021 but suffered setbacks and delays.

Trump's net worth fluctuates with the stock price, and on March 26, when the stock reached a high of $79.38, the Republican candidate for president of the Republican Party of Massachusetts held a majority stake worth more than $6 billion.

This has boosted his net worth to about $6.5 billion, putting Trump on the Bloomberg Billionaire Index (a ranking of the world's 500 richest people) for the first time in history. His current holdings are worth about $2.6 billion.

While the six-month lockup may prevent Trump from selling or borrowing against his holdings in the media company, the increase in his net worth could give him a timely windfall as he appeals the $454 million civil fraud judgment against him.

The company's stock has attracted the interest of short sellers: investors who try to sell borrowed shares in the hope of making money when the stock price falls.

According to data provided by S3 Partners, as of March 25, the last day Digital World Acquisition ceased trading, short sellers had placed bearish bets on the company, selling short approximately 16% of its free float, making it the most shorted Special Purpose Acquisition Company (SPAC). Acquisition Company (SPAC).

Analysts say shorting SPACs is often more difficult than betting against common stocks because of the lack of stock lender-provided shares.

About 12% of DJT's free float are currently shorted, according to S3. Among stocks with at least $50 million in short interest, Dow Jones Industrial stock is the most expensive to borrow, according to the firm's data.

"That's the main reason we haven't seen a lot of short selling in the stock," said Ihor Dusaniwsky, director of predictive analytics and mass manager at S3 Partners.

Trump Media stock options attracted a lot of bullish activity in the first few days after going public. Trading activity has since leveled off, but remains strong.

Currently, the stock options show an accumulation of open positions in the name of the person whose strike prices range from $2.50 for puts to $100 for calls.

"Trading has been very active, expressing different views on the stock, and there is a very high concentration of open positions in both out-of-the-money puts and calls," said Steve Sosnick, chief mat strategist at Interactive Brokers.

"It seems fair to say that speculators - looking to make big moves on both sides of the曏 - are trading heavily.

Traders don't expect the stock to stabilize anytime soon. Trump Media's 30-day implied volatility, a measure of recent stock price movement, is 1,601 TP3T, indicating a daily price swing of about 101 TP3T. Trade Alert data shows that the average 30-day implied volatility of the five most actively traded options varieties is about 441 TP3T.

(Reporting by Saqib Iqbal Ahmed; Editing by Ira Iosebashvili and Jonathan Oatis)