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Trump Media and Technology Group stock sunk 4% in Tuesday afternoon trading, ending a short rally as voting begins across the U.S.
Shares of Trump Media, the company that owns former President Donald Trump’s social media site Truth Social, traded at $33.25, after climbing roughly 15% to around $39 earlier in the day. Trading was temporarily halted due to volatility.
The stock closed up more than 12% Monday following a renewed bout of “pre-election euphoria” ahead of the presidential election. The stock has become something of a proxy for the Republican candidate’s odds of beating out Vice President Kamala Harris, the Democratic nominee.
Much of the trading of DJT stock is a result of people’s fanaticism for the former president and “pre-election euphoria,” making it what Morningstar’s (MORN+0.42%) vice president of research John Rekenthaler calls an “affinity stock.”
“This is the most emotional stock on the stock exchange,” he previously told Quartz.
It’s not clear what’s driving either the rallies or the losses. The company has not disclosed any material changes to its operations. As the vote count nears, both national and swing state polls continue to show Harris and Trump neck and neck.
The stock has had an especially volatile few weeks, sinking some 40% between Tuesday and Friday last week but recovering almost all of those losses early this week. In the past 30 days, shares have risen almost 90%. That has added billions to the company’s market value — and to the net worth of the former president, who holds a roughly 57% stake in the company.
Trump has previously said he has no plans to let go of his holdings, despite the end of a six-month share lockup period that prevented him and other insiders from selling.
Rekenthaler has warned, however, that Trump Media stock will “go to zero” if the Republican candidate loses the White House for a second time. If Trump were to win, on the other hand, Rekenthaler believes the stock “could do anything.”