Trump's DJT Falls 7% a Day After Historic Conviction

The organization built around Donald Trump's social media app Truth Social fell more than 7% today, adding to yesterday's 14% plummet, a day after Trump became the first former U.S. President to be convicted of a felony. 

Trump Media & Technology Group, ticker DJT, fell $3.94 to $47.90 around noon eastern time. Far-right leaning exchange-traded funds, including Unusual Whales Subversive Republican Trading ETF (KRUZ) and the American Conservative Values ETF (ACVF) also recently declined while MAGA added a few fractions of a percentage point in light trading. 

A fund focused on Democratic causes, the Democratic Large Cap Core ETF (DEMZ) was down just under a percentage point. 

A New York jury on Thursday found the former President on 34 felony counts for falsifying records to hide a sex scandal that could have jeopardized his 2016 Presidential campaign. Trump is the presumptive Republican nominee in this year's Presidential election. How the verdict affects his campaign and business interests remains uncertain, however.

Read More: How DJT Stock Might Become an ETF Holding

Trump Media is the product of a merger in March with a shell company, Digital World Acquisition Corp. The stock soared more than 50% in its first day of trading before dropping. Its share price over the past three months has been volatile, alternatively buoyed by the ex-President's personal following and brand recognition but weighed down by concerns about its financial performance. 

Questionable Financials

The company has an $8.5 billion market capitalization, but it suffered a net loss of $327.6 million in its first quarter on less than $1 million in revenue. Trump owns about two-thirds of the company's shares, but he isn't allowed to sell them for another three months, per a lockup agreement. The stock does not appear to be a holding in any ETF and observers have questioned its value as an investment. 

In an interview in late March, Matthew Tuttle, founder of Tuttle Capital Management in Greenwich, Conn. told etf.com that he struggled "to see the value of Truth Social if it’s purely trading on fundamentals."

The stock also faces practical obstacles in its inclusion. Many ETFs track a benchmark index, such as the S&P 500, and the process for adding a new stock to an index can be multi-layered depending on the specific index provider and the characteristics of the index itself. 

DEMZ, which debuted in November 2020, has about $35 million in assets under management. It has risen more than 13% this year, amid rising interest in a tense Presidential election year.