Democratic Representative Morgan McGarvey disclosed a surprising trade involving Trump Media stock (NASDAQ: DJT), the media company linked to President-elect Donald Trump.
The Congress trade transaction occurred on November 6, 2024, a day after the presidential election, and was valued between $1,001 and $15,000.
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This timing coincided with provisional results indicating that Trump was on course to win his re-election bid for a second term at the White House.
In this case, it can be argued that while making the trade, the politician anticipated the stock to rally in reaction to Trump’s win.
However, McGarvey’s explanation for the trade raises further questions, as he claimed that the purchase was made “without his or his spouse’s knowledge.”
To this end, just two days later, the lawmaker sold the stock at a loss of roughly 7%.
The DJT transaction stands out, especially for a Democratic congressman known to oppose Trump’s policies.
It’s worth noting that the history of such trades has mostly involved Republican politicians, such as Marjorie Taylor Greene, whose purchases have conceded with a period the stock experienced notable volatility swings.
McGarvey’s DJT disclosure was part of a batch of about a dozen trades, including transactions in major companies like Nvidia (NASDAQ: NVDA), Tesla (NASDAQ: TSLA), and Shell.
Notably, the politician made a significant bet on Tesla before the election, snapping up the company’s shares between $1,001 and $15,000 at prices ranging from $232 to $260 per share on October 25, 2024—just before the stock embarked on its post-election rally.
DJT price analysis
By press time, DJT was trading at $35.31, having rallied over 2% in the past 24 hours. Notably, the stock’s performance has failed to mirror other equities that rallied significantly, buoyed by Trump’s election. This is highlighted by the fact that the equity is up just 4% over the past month.
DJT’s stock has rarely traded in tandem with its fundamentals, and its performance is tied to sentiment around Trump, an element that is likely unsustainable in the long term.
The recent price movement has coincided with a period when key insiders and institutional investors have liquidated their stakes in the company. Overall, the stock has potential growth if the pricing sticks to the underlying fundamentals.
Featured image via Shutterstock
