Trump-linked special acquisition company sparks frenzy as small investors pile in
Global News
Digital World Acquisition's stock surge on Friday and Thursday were reminiscent of the meme stock frenzy earlier this year.
Shares of the blank-check acquisition company that plans to publicly list former U.S. President Donald Trump‘s new social media company soared again on Friday but trading was halted multiple times due to volatility, with small-time investors talking up the stock on social media.
Digital World Acquisition Corp’s shares were last up $162.7% 162.7% at $119.52 after earlier hitting a high of $175.
The moves on Friday and Thursday were reminiscent of the meme stock frenzy earlier this year when an army of retail investors coordinated on online forums to drive shares of GameStop Corp and other heavily shorted stocks.
The special purpose acquisition company (SPAC) Digital World had soared more than 300% on Thursday, giving it a market capitalization of almost $1.5 billion on news it would merge with Trump’s media company to create a social media app called TRUTH Social.
“There’s a tremendous amount of Trump supporters in the country who are going to just clamor to get some exposure to Donald Trump in whatever way they can,” Eric Diton, managing director of investment advisory firm The Wealth Alliance, said.
Data from brokerage Fidelity showed Digital World was the most traded stock on its platform on Thursday, with buy orders outnumbering sell 1.4-to-1.
It was also the most discussed stock on trading-focused social media site Stocktwits, a platform commonly seen as a measure of interest from retail investors. Message volumes on Stocktwits related to the SPAC were up more than 9,000%.
