Trump’s Surprise Move Sends Trump Media Shares Tumbling
In a sudden and unexpected move, President-elect Donald Trump has transferred his entire stake in Trump Media and Technology Group to a revocable trust, sparking a sell-off in the company’s shares. The transfer, disclosed in a regulatory filing on Thursday, involves nearly 115 million shares worth around $4 billion, making up more than half of the company’s outstanding stock.
A Mysterious Move
The reasons behind Trump’s decision to transfer his shares to the Donald J. Trump Revocable Trust remain unclear. What is known, however, is that Donald Trump Jr. has been appointed as the sole trustee, granting him sole voting and investment power over the trust’s securities.
Market Reaction
Trump Media shares took a hit on Friday, plummeting around 2% to $34.68 each in midday trading. At one point, the stock had fallen as much as 6%. This volatility is nothing new for Trump Media, which has experienced wild swings in its stock price since its March debut.
A History of Volatility
The company’s shares have been highly sensitive to news related to Trump, surging or tumbling in response to developments both positive and negative. In May, the stock took a hit following Trump’s conviction in a hush money trial, only to rebound in July after an assassination attempt. The stock then surged again in November, following Trump’s re-election, despite the company reporting a $19.2 million third-quarter loss.
The Birth of Trump Media
Trump created Trump Media in the aftermath of his ban from Twitter and Facebook, which followed the January 6, 2021, Capitol riot. The company’s social networking site, Truth Social, has been a central part of Trump’s efforts to build a media empire.
What’s Next?
As investors struggle to make sense of Trump’s surprise move, one thing is clear: Trump Media’s stock price will continue to be closely tied to the fortunes of its founder. With the company’s shares already experiencing extreme volatility, it remains to be seen how this latest development will impact its future performance.
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