And many traders are betting that the stock price will continue to fall further.
Shares of Trump Media have erased all their gains since they began trading under the ticker DJT last month.
The stock closed down more than 8% Monday at $37.17 after falling about 11% earlier in the day. It had traded above $79 a share on March 26, the day of its debut.
But experts say it’s hard to draw any firm conclusions about what the stock price’s movement means. That’s because so many available shares — about 12%, one of the highest ratios of any active stock listing — reflect traders’ bets that the stock will fall, said Ihor Dusaniwsky, managing director at S3 Partners, a data and predictive analytics company.
This is called short-selling.
First things first, I don’t really know how to actually shortsell stuff. My portfolio is super basic and my original comment was only half serious.
But I think you have the causality the wrong way around.
It’s less that the stock profits if my short fails.
It’s more that my short fails (in that I lose money) if the price of the stock goes up.
A single small shortsale can’t really affect the stock price in a meaningful way, but if it could it would generally lower the stocks price since it is a signal that the market (which the shortseller is a part of) has no trust in the stock.
That said I am by no means a trading expert myself and could possibly miss some effects on the market.
I only invest long term in broadly spread ETFs (think MSCI World and similar).