How Digital World Acquisition Corp Stock Minted Millionaires

Digital World Acquisition Corp Stock, which is now called Trump Media & Technology Group (NASDAQ: DJT), has made a lot of people a lot of money.  But perhaps not for the reasons you may think.

DJT, which is the company behind the social media platform Truth Social, is little more than an unprofitable company that has the advantage of its stock being supported by a conga line of loyal Trump supporters. 

I don’t say this to be critical of Trump supporters.  It’s just an observation of truth.  Because if you were to look at the stock strictly from a technical standpoint, it’s a dog.  But it’s also a trader’s dream.

Digital World Acquisition Corp Stock for the Win!

The trading frenzy began when it was first announced that Digital World Acquisition Corp was taking Donald Trump’s social media platform public.  Following that announcement, the stock gained more than 120%.

No matter how you feel about Trump, the bottom line is that this guy has a lot of fans.  And indeed, the Trump brand can still put asses in seats.  This was true back in October, 2021, when Trump made the announcement, and it’s been true ever since. 

Here you can see that there have been three separate occasions where traders bought the dip, then quickly locked in gains in excess of 100%.  And I believe there will be more, too. 

But ultimately, the stock will crater.  After all, it doesn’t take a rocket scientist to see why Truth Social is not a viable long-term investment.  I actually opined on this last month, giving 5 reasons why DJT is a horrible investment for those looking for safe, long-term gains. 

1. The very existence of Truth Social relies upon Donald Trump’s involvement.  Aside from Tesla or Berkshire Hathaway, I wouldn’t invest in a company whose success is inextricably linked to one individual.  Especially when that individual carries with him a history of failed business and bankruptcies.
2. DJT overpays management.  Last year, the company did $4 million in revenues.  About 40% of those revenues equate to what the company pays to its executives — around $1.7 million.  This, at a company that in 2023 posted a net loss of $58.2 million.  How one justifies paying nearly $2 million in executive compensation for a company that generates $4 million in revenue while losing nearly $60 million is beyond me.
3. There is no evidence to indicate that the company is investing much, if anything, in R&D.  In the social media game, if you’re not innovating, you’re dying.
4. The stench of criminal behavior.  Two of the initial investors in DJT pleaded guilty to insider trading, and two of the company’s early investors already challenged the six-month lock-up.  These guys are a bit too eager to dump their shares.  They want out before the lights come on and the roaches begin to scurry.  And make no mistake: when that lock-up expires, there’s going to be a rush to the exit, leaving most retail investors in the dust.
5. Limited user growth.  For the most part, it’s just Trump loyalists that spend time on Truth Social.  And while they are a loyal bunch, there are only so many of them willing to spend time on the site and help the company generate revenue.  With little to no possibility of steady increases in new users, Truth Social really has no justifiable long-term potential.

I knew from the time that Digital World Acquisition Corp Stock got a big bump from its announcement regarding Truth Social that this would be a playground for traders. But also set a trap for amateur investors who bought the stock for no other reason than to support Trump.  And that, dear reader, is what will ultimately leave them in the poor house.

But for those who know a good deal when they see one, you’re not going to get many sweet trading opportunities like the ones spawned from DJT.  Except for maybe this new SEC hack that actually forces the world’s top hedge fund managers to pick stocks for you — for free.

I know it sounds crazy, but this is very real.  And all you need to take part is a copy of the SEC form 13F.  If you’re unfamiliar, every major hedge fund in the world is required to file this thing.  And this form lists every last detail of their portfolios, including the ticker symbol of every stock they’ve purchased, exactly when they made those purchases, and how many shares they own. 

My colleague Alex Bouldon has put together a special guide that shows you how exactly to access these forms.  He even highlighted 5 “super traders” that are essentially the best in the business.  You can read more about those super traders here.

Bottom line: you can make a lot of money by trading DJT.  But you can make even more money by accessing those F13 forms and simply allow the best traders in the world to make you rich.

To a new way of life and a new generation of wealth…

Jeff Siegel

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Jeff is the founder and managing editor of Green Chip Stocks. For more on Jeff, go to his editor’s page.

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