New York, NY – Shares of Trump Media surged by over 15% on Wednesday, despite recent steep declines. The closing price of $26.40 marked a significant improvement, although still 63% lower than its opening price on March 26. The stock had seen a 20% drop the previous week, followed by further declines of more than 18% on Monday and over 14% on Tuesday, painting a grim picture for the company.

With former President Donald Trump holding nearly 60% of Trump Media’s shares, the recent losses in share value have been a cause for concern. Trump’s 78.75 million shares could potentially increase by 36 million if the price stays above $17 per share, thanks to an earnout provision in the merger deal. Despite Trump being the presumptive Republican presidential nominee, his association with Trump Media has not shielded the company from billions of dollars in share value disappearing due to price drops.

In response to the consecutive days of sharp price drops, Trump Media released additional guidance on how shareholders can prevent their shares from being loaned for short selling. The company emphasized actions such as holding shares in a cash account, opting out of securities lending programs, and transferring shares to designated agents or retirement accounts to protect against short selling.

Moreover, Trump Media provided detailed instructions for shareholders to communicate their preferences to brokers regarding stock loan activities, contrasting the simpler instructions initially shared. The risks of short selling were highlighted, underscoring the potentially exponential losses short sellers could face if stock prices rise unexpectedly. The complexities of short selling were conveyed, emphasizing the importance of experienced investors with necessary cash or collateral to cover potential losses.

Acknowledging the potential profits for brokerage firms from lending shares to short sellers, Trump Media aimed to educate its shareholders on the implications of short selling. The limited availability of DJT shares for shorting further underscored the dynamics at play in the market. Market analysts warned of the potential impact of increased short selling on stock prices if larger quantities of shares became available.

Overall, the volatility in Trump Media’s share prices and the company’s efforts to address concerns over short selling underscore the challenges faced by both the company and its shareholders. Balancing the interests of investors with market realities remains a key focus for Trump Media as it navigates the complex dynamics of the financial landscape.