Shares of Trump Media & Technology Group (DJT) rose as much as 15% on Thursday as the company tried to fend off short sellers amid a volatile trading week.
According to an updated FAQ page on Trump Media’s website, which is also included in a new securities filing posted Wednesday, the company is advising investors on ways to avoid having their shares lent out for a short interest position.
Short interest in DJT stock (bets that the stock price will fall rather than rise) is around 13% of shares outstanding, according to the latest data from S3 Partners. That’s up from about 11% at the time of its public market debut. The average short-term interest rate in listed companies is between 3% and 4%.
Trump Media went public on the Nasdaq after merging with special purpose acquisition company Digital World Acquisition Corp. in a deal approved by shareholders late last month. Shares are down about 55% since late March.
“To prevent shares from being loaned out for a short interest position, you should contact your brokerage firm to place restrictions on lending your shares to short sellers,” the company said in its filing.
Trump Media provided a sample letter for investors to send to their brokers, recommending “opting out of all securities lending programs.” The company also advised investors to keep their DJT shares in a cash account at a brokerage firm instead of a margin account, in addition to transferring shares to a bank to hold them in a retirement account.
The short-selling prevention advice comes after shares plummeted earlier this week. On Monday, the company had applied to issue more than 21 million shares. A day later, it announced a new live TV streaming platform.
Trump has about a 60% stake in Truth Social. At current levels of about $30 per share, Trump Media has a market capitalization of about $4 billion, giving the former president a share of about $2.4 billion. Immediately after the company’s public debut, Trump’s stake was worth just over $4.5 billion.
The former president founded Truth Social after being kicked off major social media apps like Facebook and Twitter, the platform now known as
According to an updated filing published earlier this month, Trump Media reported revenue of just over $4 million, while net losses reached nearly $60 million for the full year ended December 31. The company warned that it expects losses to continue amid heightened profitability challenges.
The filing also confirmed that stakeholders are still subject to a six-month lock-up period before selling or transferring shares. The only exception to the lock-up period would be if the company’s board votes to grant a special dispensation. While possible, experts told Yahoo Finance last month that the attempt would likely result in multiple lawsuits on behalf of public shareholders.
Trump faces a $454 million fraud fine and campaign fund shortage ahead of his 2024 election rematch against Biden.
Trump recently posted a $175 million bond in the fraud case, putting the final payment on hold while he appeals the verdict.
He also faces a criminal trial in connection with alleged payments to adult film star Stormy Daniels.
Alexandra Canal is a senior reporter at Yahoo Finance. Follow her on X @allie_canal, LinkedIn, and email her at alexandra.canal@yahoofinance.com.
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