Shares in Donald Trump’s social media company, Trump Media and Technology Group (TMTG), plummeted by 5% on Wednesday morning following concerns over the possibility of a massive insider selloff. The company filed paperwork with the Securities and Exchange Commission (SEC) that would allow President Trump’s trust to sell up to nearly 115 million shares worth over $2 billion.
The filing, which was completed earlier this year, has sparked worries among investors that a large-scale sale by the president could trigger a panic and damage the company’s stock price. However, TMTG pushed back on the rumors, stating that the filing is routine and does not guarantee any sales.
Finance experts have warned that if insiders were to sell their shares at a profit, it could lead to a decline in the company’s share price. University of Florida finance professor Jay Ritter noted that TMTG has struggled to establish an operating business model, but has been successful in selling its stock.
The SEC filing provides updated information on President Trump’s majority stake in the company and flags the possibility of an additional 8 million shares hitting the open market. While it does not guarantee any sales, it signals to investors that there could be a large-scale selloff.
Trump himself has stated his intention to hold onto his shares, saying “I don’t need money.” However, the possibility of an insider selloff remains a concern for investors and analysts alike.
Source: https://abcnews.go.com/Politics/trump-media-filing-opens-door-president-sell-2b/story?id=120409342