Strategy stock rises as CEO downplays potential MSCI index removal

Investing.com -- Strategy (NASDAQ: MSTR) stock rose 3% Wednesday as Chairman Michael Saylor dismissed concerns about the company’s potential removal from MSCI indices, while bitcoin’s price recovery provided additional support.

The cryptocurrency-focused company faces a January 15 decision from index provider MSCI, which is evaluating whether to remove companies that primarily buy cryptocurrencies from its indices due to their resemblance to investment funds. Strategy, currently included in the MSCI USA and MSCI World indices, could see outflows of up to $8.8 billion if removed, according to JPMorgan estimates.

"It won’t make any difference, in my opinion," Saylor said regarding a potential exclusion, while confirming the company is "engaging in that process" with MSCI. The chairman made these comments during an interview on the sidelines of a Binance event in Dubai, according to a report from Reuters.

Strategy’s business model involves using a listed company structure to accumulate bitcoin, allowing investors to gain cryptocurrency exposure through equities. However, this approach has fallen out of favor with investors this year, as evidenced by the stock’s 37% decline, significantly underperforming bitcoin’s modest 0.5% drop.

Wednesday’s stock movement coincided with bitcoin’s recovery to $93,000 after hitting a low of $83,800 on Monday, lifting related stocks across the sector.

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