A Surge in Trading Preceded Trump’s SPAC Deal

A Surge in Trading Preceded Trump’s SPAC Deal

The New York Times-Business·2021-12-10 06:07

A few weeks before Digital World Acquisition announced a deal to merge with a fledgling social media company backed by former President Donald J. Trump, it was at the center of a sudden trading frenzy.

Digital World, a special purpose acquisition company, began allowing the trading of warrants — potentially lucrative contracts that give the holder the right to buy shares of a stock at a predetermined price at a future date. Such securities are typically offered to investors or executives as sweeteners, allowing them to buy additional shares of a company cheaply if the stock rises.

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