Hudson Bay, Morgan Stanley took positions in Trump social media firm in Q1

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By David Randall

NEW YORK (Reuters) – Hudson Bay Capital Management, Geode Capital Management and Morgan Stanley were among the large institutional investors that took positions in Donald Trump’s Trump Media & Technology Group in the first quarter, securities filings showed on Wednesday.

The former president, who is running as the Republican candidate in the Nov. 5 presidential election, holds a majority stake in the company. It owns social media site Truth Social, where Trump has 7 million followers and is a prolific poster.

Hudson Bay Capital bought 150,000 shares in the quarter, initiating a position worth nearly $10 million at the end of March and now worth about $7.8 million. Geode Capital Management, a spinoff of mutual fund giant Fidelity, bought 102,923 shares during the quarter, while Morgan Stanley bought 44,346 shares.

Shares of Trump Media have been volatile, surging as much as 59% when they began trading on the Nasdaq on March 26. The rally attracted short-sellers, who posted mark-to-market profits of $91.1 million in April as shares tanked, according to S3 Partners. The stock has jumped 5% in May.

Trump Media notified the Securities and Exchange Commission on Wednesday of a delay in its quarterly filing because it recently replaced an auditor that the regulator charged with fraud. Shares fell nearly 1.7%.

The company reported an operating loss of $10.6 million for the first nine months of 2023 on revenue of $3.4 million, and currently has a market value of approximately $7 billion.

Firms including Shaolin Capital Management, Simplex Trading, Picton Mahoney Asset Management and Radcliffe Capital Management bought put options on the shares, which are typically bearish bets that pay off if a share price goes down, according to securities filings. It wasn’t clear, however, if these were part of a broader trading strategy.

Quarterly disclosures of hedge fund and other institutional investors’ stock holdings in 13F filings with the SEC are one of the few public ways of tracking what hedge fund managers are selling and buying. The disclosures are made 45 days after the end of a quarter and may not reflect current positions.

(Reporting by David Randall; Editing by Cynthia Osterman)

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