micro strategyThe favorite would be the high beta play on the price of Bitcoin Add The Nasdaq 100 index, a move that could further increase demand for the controversial stock that has been in a very bad shape this year, along with the price of cryptocurrencies.
nasdaq 100 It includes the 100 largest technology-focused non-financial companies nasdaq composite indexThe addition of a stock means that ETFs – including the highly popular Invesco QQQ TrustWho has assets worth $325 billion – will also become an automatic buyer.
Shares of Bitcoin Proxy could be set for further gains. There has been an increase of more than six times this year compared to of bitcoin There was a profit of about 140% in the same period.
The change, which will take effect before markets open on December 23, was announced after stock markets closed on Friday. MicroStrategy was widely circulated as a potential contender for membership by investors who were waiting for a rebalancing of the index this week.
“This will lead to the inclusion of MSTRs in some of the largest ETFs like QQQ (the fifth largest ETF) etc., leading to one-time fresh buying… and continued participation in future inflows,” said Gautam Chugani, an analyst at Bernstein. ” A note this week before the shuffle.
Additionally, “the market will likely keep its eye on S&P 500 inclusion for 2025,” Chugani said. “At present, due to the profitability of its software business, it may be challenging to consider inclusion in the S&P 500.”
Nasdaq changes the constitution of the Nasdaq 100 index every year. The companies selected for inclusion are based largely on their market cap rankings as of the last trading day of November, which this year was November 29. Stocks must also meet eligibility requirements around liquidity and the free float percentage of their shares.
MicroStrategy originally sold enterprise software, but the company has increasingly become a Bitcoin holding company. It first added Bitcoin to its balance sheet in 2020, when Michael Saylor was CEO, and is leaning on strategy In the years that followed. MicroStrategy now issues convertible notes to leverage its purchases, and daily trading of its stock sometimes resembles a more volatile version of Bitcoin.
The company’s market cap is now nearly $90 billion, according to FactSet, despite revenue being less than $500 million over the last four quarters. Saylor told CNBC “squawk box“Earlier this month he looks at the company’s role”securing bitcoin,
“Primarily, our job is to bridge the traditional capital markets that want bonds, or they want fixed income, or they want equities, or they want alternatives, and we plug that into the crypto economy. And we They use Bitcoin as a vehicle,” said Saylor, who is now executive chairman of the company.
MicroStrategy started increasing its purchases after the US presidential election. The victory of pro-crypto President-elect Donald Trump – particularly his promise to establish a national strategic Bitcoin reserve – has driven Bitcoin to new all-time highs, partly achieved by the company’s purchases. MicroStrategy now holds 423,650 Bitcoins. It bought 149,880 in four separate purchases over the past month, starting on November 11.
As part of MicroStrategy’s hot streak this year, activists have been pushing Bitcoin investments as an agenda item at shareholder meetings. In companies like Microsoft And Amazon. Mining stocks like Mara Holdings have also started Employing Saylor’s Bitcoin Yield Strategy,
Palantir Technologies And Exxon Enterprise It will also join the Nasdaq 100 later this month. Illumina, Moderna And super micro computer Will be removed from the index.
Last year, the Nasdaq 100 added six companies, including DoorDash, in its annual reorganization. Five of those six stocks rose after the announcement on Monday, with an average move of 1.21%.
– With reporting from Jesse Pound.
