Trump SPAC soars to 1,657% since deal announced

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Shares of shell company Trump new media company plans to merge with surged 284% on Friday, prompting a series of trading stops for volatility.

Digital World Acquisition Corp. ended the day up 107%.

At its peak of $ 175 on Friday, the Nasdaq-listed company was 1,657% above its closing price on Wednesday.

The new Trump entity is merging with Digital World Acquisition Corp., which closed at just $ 9.96 on Wednesday. The stock quadrupled Thursday, then climbed to $ 131.90 Friday morning.

“It’s extremely unusual, especially now,” said Matt Kennedy, senior IPO market strategist at Renaissance Capital. “We saw big pops at the height of the PSPC bubble. These days it’s rare to see a PSPC pop over 10%.”

Normally, PSPC merger announcements contain financial projections and details of the capital structure. In this case, it was simply a press release and a presentation to investors which did not contain any estimate of how much money the business could bring in.

“This is clearly meme equity territory. It is totally out of touch with fundamentals. There are no known fundamentals,” said Kennedy, who cautioned investors that $ 10 should be considered the floor for this action.

“Be prepared to potentially lose everything else,” he said. “This is a purely momentum stock market action.”

The Trump SPAC arouses the interest of WallStreetBets traders, according to Swaggy Stocks, which follows mentions on the Reddit page. WallStreetBets is the Reddit group at the heart of the GameStop saga earlier this year.

The windfall comes despite the latest filings fail to show how much revenue – if any – the Trump Media & Technology Group is generating. This is likely to be minimal, given that the company’s social media platform has yet to launch.

Trump’s companies have a long history of bankruptcy: Trump has filed four corporate bankruptcies, all focused on casinos he owned in Atlantic City.
Trump’s last IPO was in 1995 when he went public with Trump Hotels & Casino Resorts. The casino society posted losses every year it was public, and a decade later, she filed for bankruptcy.


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