Trump Media shares fall the day after trading was halted five times for being too volatile

On Wednesday, Trump Media’s stock fell 12% in the first 90 minutes after the market opened. The day before it traded on the stock stopped five times due to excessive volatility. The stock closed at $51.51 on Tuesday but was down to $45.57 on Wednesday morning.

Trump Media has been on a tear over the past month and is up 270%. While the recent path for the share has been decidedly up and to the right, intraday trading has been characterized by large fluctuations in the share price. On Tuesday, the stock fell 13% in the first hour of trading, before rising another 16% later in the day. After-hours trading saw the stock fall another 8% from its closing price of $51.

The wild swings have been largely thanks to frantic levels of trading activity in the Trump Media and Technology Group (TMTG) in the run-up to next week’s presidential election.

TMTG stock (ticker symbol DJT) often trades more like a referendum on Trump’s political odds than on his actual business performance. For the past few weeks, prognosticators have pointed to a tight race that is effectively deadlocked, even as it tips in Trump’s favor. These predictions have favored DJT stock as much as the candidate.

After bottoming out at $12.15 a share in late September, the stock saw a rally that coincided with Trump’s rise in the polls. In mid-October, a series of polls showed Trump narrowly leading Vice President Kamala Harris. Around this time, TMTG had its two highest volume trading weeks since going public. In the week of October 7, 195 million shares were traded. That figure was topped the following week, when 278 million shares were traded. By Tuesday morning, the stock had surpassed its 30-day trading average at 10:15 a.m. ET.

The huge number of shares trading hands suggests that momentum traders may be looking to ride TMTG for some quick and relatively easy gains. Momentum traders are investors who look for rising stocks and buy them until they peak. More often than not, these types of investors are looking to take advantage of a positive move in the stock market rather than investing in the company for the long term.

Trump owns about 114.5 million shares in TMTG, which equates to 57% of the company. So far, he has not sold any of his shares, although he is legally allowed to do so after a lockup period that was lifted in September. Trump’s stake in the company is worth just over $5 billion as of this article’s publication and now makes up the majority of his net worth.

TMTG did not immediately respond to a request for comment.