Ignore the Drama: The Smart Investor’s Approach to Trump Media Stock

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Trump Media & Technology Group (NASDAQ:DJT) is often in the financial and nonfinancial headlines. Political polls and voter sentiment, however, don’t provide any insight on what to do with Trump Media stock. Your investment strategy needn’t be complicated. Let’s examine Trump Media to clear up confusion and reach a reasonable conclusion.

First and foremost, don’t get sidetracked by chatter about meme stocks. Trump Media is a real company, offering an alternative to social media platforms like Elon Musk’s X (formerly Twitter). When you view Trump Media in that light, everything should be much clearer and your investment approach can be simple and straightforward.

Trump Media Stock: What It Is, and What It Isn’t

Let’s clear up some confusion right away. Trump Media stock isn’t a campaign contribution and, as we just mentioned, it’s not just a meme. It’s also not just a bet that Donald Trump will win the U.S. presidential election in November.

Rather, Trump Media shares represent a financial interest in a business, and that business is Truth Social. This business venture can succeed irrespective of who’s in the White House.

Remember, Truth Social is all about providing a platform to suppressed/silenced voices and viewpoints. It’s an alternative to Musk’s X — which, by the way, is considering charging new users a fee for basic functions such as posting and responding to posts.

Some X users might get fed up with Musk’s platform and switch over to Truth Social. Besides, Truth Social is preparing to launch a live TV streaming platform. With this expansion, Truth Social’s content should be more dynamic and could reach a wider audience.

Don’t Get Caught Up in Short-Selling Drama

There’s a fine line between monitoring a news story and being distracted by that story. With Trump Media stock, it’s OK to keep tabs on the stock’s short interest (i.e., percentage of outstanding shares that are sold short). Don’t base your entire investment strategy on this information.

Various reports have estimated the short interest for DJT stock as approximately 11%12.6% or 13% of the outstanding shares. Indeed, there is a distinct possibility of a short squeeze, as high short interest can result in a snapback effect.

Sure, you can trade small amounts of Trump Media stock as a potential short-squeeze stock if you want to. For serious investors, however, your focus should be on Truth Social’s build out.

Don’t be surprised if you see more news stories pitting Trump Media against the “naked” short sellers. It’s an eye-catching story that’s meant to capture your attention. As an investor, your job is to stay focused and be nimble. The Trump Media share price is a fast-moving target, and you can’t afford to let yourself get distracted.

Trump Media Stock: Don’t Overcomplicate This!

Investing for the long term in Trump Media & Technology Group isn’t about memes or politics. It’s fine to keep track of polling data and short interest, but don’t overcomplicate your strategy.

If you envision robust growth for Truth Social, then it makes sense to invest s small amount of capital in Trump Media. It’s really as simple as that.

Patient investors can use a strategy of reducing their cost basis. Buy Trump Media stock if it declines by 20%, then buy more if it falls another 20%, and again if it falls by an additional 20%. That way, you can be in the trade without chasing the stock at high prices.

On the date of publication, neither Louis Navellier nor the InvestorPlace Research Staff member primarily responsible for this article held (either directly or indirectly) any positions in the securities mentioned in this article.

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The post Ignore the Drama: The Smart Investor’s Approach to Trump Media Stock appeared first on InvestorPlace.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


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