Around Our Network

Trump Media scrambles to stop short sellers from tanking share prices



Trump Media and Technology Group, the parent company of Truth Social, is scrambling to stop short sellers from tanking its share values.

NBC News reports that Trump Media this week sent around suggestions to shareholders to prevent their shares in the company from winding up in the hands of short sellers who are essentially betting on the company's failure to make money.

According to NBC, the "tips include holding DJT shares in a cash account at a brokerage firm as opposed to a margin account, 'opting out of any securities lending program,' moving Trump Media shares to the company’s designated transfer agent, and transferring shares to a bank and 'holding them in your retirement account.'"

Short sellers essentially pay brokerage firms fees to borrow shares on a temporary basis on the belief that the shares will sink in price.

READ MORE: From 'really rich' to begging: Inside Trump's U-turn on one of his first campaign lies

After borrowing the shares, the short sellers proceed to sell them on the open market and then by them back by a specific date when they have to be returned to their owners.

If the share price in that time has indeed gone down, then the short sellers pocket the difference they made between the original sale and the repurchase.

If the share price increases, however, the short sellers lose money because they'll be buying back the shares at a higher price than the original sale.

Short sellers have swarmed to Trump Media shares for weeks now, as its price has plummeted from a high of $66.22 on March 27th to a low of $22.84 on Tuesday, although its price has recovered some of that lost value in the last day-and-a-half of trading.

The longer-term threat to Trump Media's value likely isn't short sellers, however, but simply a lack of profitability. The selloff in shares started earlier this month when the company released an earnings report showing that it lost $58 million in the last fiscal year while generating just $4 million in revenues.

7th Annual Beau Fleuve Music & Arts Celebration at the Buffalo Central Terminal Sunday

The 7th Annual Beau Fleuve Music & Arts Celebration of music, arts and culture that will host a weekend long event starting THURSDAY August 24th to SUNDAY AUGUST 27th,

Making the case for a library in a book desert

The vacant Plewacki American Legion Post building at 385...

Mother Teresa Home / St. Adalbert Celebration Mass – Saturday, August 26th

All are welcome for Mass at St. Adalbert Basilica on Saturday, August 26th in collaboration with the Mother Teresa Home.  Reception to follow.

Apply For Univera Health Equity Innovation Award Funding

Nonprofits Can Now Apply for Univera Healthcare Health Equity...

Junior Jerry Jam RAISES FUNDS FOR MULTI-INSTRUMENTALIST AND AWARENESS FOR COLON CANCER SCREENING IN BLACK COMMUNITIES

  Nationally known saxophone player’s advanced-stage colon cancer journey hits...
Buffalo
broken clouds
51.3 ° F
56.1 °
47 °
84 %
1.3mph
75 %
Fri
54 °
Sat
48 °
Sun
47 °
Mon
51 °
Tue
55 °