Trump Media (DJT) CEO Devin Nunes has asked Republican lawmakers to investigate “possible manipulation” of DJT stock over what he claims are “abnormal trading” in the stock. I'm asking you to.
“Since April 2, 2024, DJT has been listed daily on Nasdaq's 'Reg SHO Threshold List' of illegal trading activity,” Nunes said in a letter to House Republican leadership on Monday. Ta. “This is particularly problematic given that 'naked' short selling often involves sophisticated market participants profiting at the expense of retail investors.”
Short interest in DJT stock (bets that the stock price will fall rather than rise) is about 13% of outstanding shares, according to the latest data from S3 Partners. The company recently tried to fend off short sellers by advising investors on how to prevent their shares from being loaned out to short positions.
To “short” a stock, a trader must first borrow the stock he already owns before selling. A “naked” short sale is the illegal practice of shorting a stock that has not yet been borrowed.
“As of April 3, 2024, DJT was the most expensive stock shorted by a wide margin in the U.S. market, according to reports. “It means we have,” Nunes’ letter continued.
Trump Media, Truth Social's parent company, 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. The stock, which rose more than 10% on Wednesday, has fallen about 50% since the end of March.
Nunes named four market participants responsible for more than 60% of DJT's trading volume: Citadel Securities, Virtu Americas, G1 Execution Services and Jane Street Capital.
The allegations echo those made by Nunes in a separate letter to Nasdaq Chairman and CEO Adena Friedman on April 18.
Representatives for Citadel, VIRTU and Jane Street did not immediately respond to Yahoo Finance's requests for comment.
Citadel, the hedge fund founded by Ken Griffin, responded to Nunes' April 18 claims with a blistering statement: “Devin Nunes is trying to blame 'naked short selling' for the decline in stock prices. “I do, the proverbial loser,” he wrote.
“Mr. Nunes is exactly the type of person Donald Trump would fire on The Apprentice. If he worked at Citadel Securities, we would fire him. Competence and integrity are our values. Because it is at the center of everything we do.”
Trump maintains about a 60% stake in Truth Social. At its current price of about $36 per share, Trump Media has a market capitalization of about $4.9 billion, and the former president's stock holdings are worth about $2.9 billion. Shortly after the company's public debut, Trump's stake was valued at just over $4.5 billion.
On Tuesday, the stock reached a milestone securing an additional $1.2 billion for President Trump.
alexandra canal I'm a senior reporter at Yahoo Finance. Follow her on X @allie_canal, LinkedIn, Email alexandra.canal@yahoofinance.com.
Click here for the latest earnings report and analysis, earnings whispers and expectations, and company earnings news.
Read the latest financial and business news from Yahoo Finance
