Trump's Truth Social merger sends stock into immediate free fall: report

Moments after Digital World Acquisition Corporation voted to merge with Trump Media, the parent company for Donald Trump's Truth Social platform, its stock took a quick drop — losing 12 percent of its value at one point.

According to a report from CNBC, stock for the company which will be listed as DJT starting next week, began the day at $44.20 before taking a quick nosedive to below $38, before a bounceback to 3.5 percent below opening.

The former president was expected to see a $3 billion windfall after the merger was completed but, by the time he is able to sell any portion of his stock, that dollar figure could change radically downward as other investors cash out.

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As CNBC is reporting, "A total of 11% of the tradable shares of DWAC are being sold short, FactSet data shows."

"This means investors holding these positions are betting the price will fall before they have to buy the shares back and return them to the entities who loaned the shares to them," the report adds.

Criminal defense lawyer Robert DeNault had warned investors should expect to see drops now that the merger was approved.

"The [Special purpose acquisition companies] merger between Digital World and Trump Media/Truth Social is vastly overvalued and the stock price will plummet in short order," he wrote.

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