Trump Media & Technology Group stock (DJT) opened around 2% higher on Monday as shares brace for another volatile week on Wall Street just one day ahead of the presidential election.
The stock suffered its largest percentage decline last week and closed down around 20% to end the five-day period on Friday.
And since Tuesday, more than $4 billion has been shaved from the company’s market cap, although the stock still has more than doubled from its September lows.
The oscillating of shares will likely continue as the election nears. One investor has warned that if Trump loses the election on Tuesday, shares of DJT could plunge to $0.
“It’s a binary bet on the election,” Matthew Tuttle, CEO of investment fund Tuttle Capital Management, recently told Yahoo Finance’s Catalysts.
Tuttle, who currently owns put options on the stock, said the trajectory of shares hinges on “a buy the rumor, sell the fact” trading strategy.
“I would imagine that the day after him winning, you’d see this come down,” he surmised. “If he loses, I think it goes to zero.”
Interactive Brokers’ chief strategist Steve Sosnick said DJT has taken on a meme-stock “life of its own.”
“It was volatile on the way up and when a stock is that volatile in one direction, it has a tendency to be that volatile in the other direction,” he said in a call with Yahoo Finance earlier this week.
Prior to the recent sell-off, shares in the company, the home of the Republican nominee’s social media platform Truth Social, had risen in recent weeks as both domestic and overseas betting markets shifted in favor of a Trump victory.
Prediction sites like Polymarket, PredictIt, and Kalshi all showed Trump’s presidential chances ahead of those of Democratic nominee and current Vice President Kamala Harris. That lead, however, narrowed significantly over the weekend as new polling showed Harris surpassing Trump in Iowa, which has historically voted Republican.
And as betting markets tighten, national polls show both candidates in a virtually deadlocked race. Polls in key battleground states like Pennsylvania, Michigan, and Wisconsin, which are likely to decide the fate of the election, also show razor-thin margins.
In September, the stock traded at its lowest level since the company’s debut following the expiration of its highly publicized lockup period. Shares had also been under pressure as previous polling in September saw Harris with a bigger lead on the former president.
Trump founded Truth Social after he was kicked off major social media apps like Facebook (META) and Twitter, now X, following the Jan. 6, 2021, Capitol riots. Trump has since been reinstated on those platforms. He officially returned to posting on X in mid-August after about a year’s hiatus.