MSCI Drops Strategy From Global Indexes, Threatening Passive Inflows
MSTR sits 48% above its 52-week low of $81.81.
Summary
MSCI will remove Strategy and other bitcoin-treasury companies from its global indexes after concluding they look more like investment funds than operating companies, a move that raises the question of whether $2.8 billion in forced selling will hit MSTR. That cuts off a passive-flow channel into a stock whose whole model is issuing equity to buy bitcoin. Strategy has been leaning on continuous stock sales to fund BTC purchases and preferred dividends, and its Q3 10-Q already showed BTC Yield at negative 11.9% as dilution outran coin accumulation. Losing index membership makes each future share sale harder to place and raises the cost of the ATM machine that feeds the treasury. MSCI is the primary hit here; the decision also affects the broader group of listed crypto-treasury names. No effective date for the removal was given in the report.
At the time of this announcement, MSTR was trading at $121.29 on NASDAQ in the Crypto Assets sector, with a market capitalization of approximately $51.7B. The 52-week trading range was $81.81 to $239.24. This news item was assessed with negative market sentiment and an importance score of 9 out of 10. Source: Reuters.