Company: DJTWW
Filing Date: 2025-11-07
Form Type: 10-Q
Source: 0001140361-25-040977
Chunk: 58

Company: Trump Media & Technology Group Corp.
Filing Date: 2025-11-07
Form: 10-Q
Item: Part I, Item 1
Chunk 58
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 securities.  Our trading securities consist primarily of equity exchange traded funds that invest in digital assets, and also include purchased call options. We had trading securities of $587,505.1 at September 30, 2025 and $0.0 at December 31, 2024, that are carried on our balance sheet at fair value. Unrealized gains and losses associated with trading securities are reflected in the condensed consolidated statement of operations. As of September 30, 2025, $455,000.0 of our trading securities served as collateral to convertible notes (Note 9).

    We did not have any investments classified as available-for-sale as of September 30, 2025.

    Options

    We manage our exposure to bitcoin price fluctuation through derivative instruments on bitcoin related securities, as part of our digital asset treasury strategy. In order to manage this risk, we sell
      covered put and covered call options, purchase call options or use a synthetic long strategy that uses a combination of a purchased call option and a sold put option which provides us exposure to increases in bitcoin prices while limiting downside
      risk should the price decrease.

    Written covered put and call options on bitcoin related securities generate premium income and allow us to purchase bitcoin related securities at lower effective prices.  The put options are covered by
      cash collateral to cover potential purchases and the call options are covered by our ownership in the underlying security. In exchange for this commitment, we receive premiums immediately paid in cash. The difference between the premium received and
      the amount paid while affecting a closing purchase transaction, including brokerage commissions, is also treated as a realized investment gain or loss.  This premium acts as income, increasing our investment yield.  If the written option expires
      worthless, we keep the full premium as profit with no obligation to purchase. If a put option is exercised, we buy the security at the strike price using the cash collateral, and the premium received reduces the effective cost basis, allowing us to
      acquire the securities at a discount compared to direct market purchases.  If a written call option is exercised, we sell the security at the strike price using our existing holdings of the security, and the premium received reduces any loss or
      increases any gain we may incur.

    The writer of an option bears the market risk of an unfavorable change in the price of the security underlying the written option. The aggregate fair value of unexpired options written is included in accounts payable and accrued expenses in the condensed consolidated balance sheets. Cash held