Nasdaq to Add MicroStrategy to the Nas100 Index

• The Nasdaq trade has introduced its yearly reshuffling of the highest 100 largest non-financial firms by market capitalisation and can add MicroStrategy to the record for the primary time.
• The expansion in MicroStrategy’s inventory value, fueled by Bitcoin’s optimistic efficiency, has ballooned its market worth, permitting it to qualify for inclusion.
• MicroStrategy’s inventory can be uncovered to passive funding alternatives by being included in Invesco’s QQQ and different ETFs that spend money on the Nasdaq’s high firms.

The Nasdaq 100 index tracks the 100 largest firms on the Nasdaq trade. The businesses included are often recipients of passive fund flows from widespread ETFs.

With a market capitalisation of $97.94 billion, MicroStrategy is the fortieth largest firm on the Nasdaq trade, largely on account of its large Bitcoin treasury. The corporate’s share value has risen 505% because the begin of the 12 months, ballooning its market capitalisation from roughly $15 billion on Jan. 2 2024 to its present worth.

MicroStrategy’s inventory rise

MicroStrategy’s super inventory value run is pushed by its Bitcoin shopping for efforts, which have spanned from August 2020 to December 2024 and have reworked the corporate right into a quasi-Bitcoin ETF.

In whole, the corporate has spent $23.41 billion on Bitcoin at a median value of $58,200 primarily by issuing debt notes. Its Bitcoin stash is value $42 billion at market costs on the time of publishing.

Extra publicity to traders

MSTR’s inclusion within the NAS100 will expose it to extra traders and funds that spend money on the Nasdaq index. The biggest fund that does that is Invesco’s QQQ belief with an AUM of $352 billion, however different funds holding billions of {dollars} additionally spend money on the businesses within the NAS100, just like the iShares NASDAQ 100 UCITS ETF.

Nonetheless, it’s value noting that not all firms within the Nasdaq 100 carry equal weighting. For instance, Invesco’s QQQ ETF allocates roughly 53.1% of its portfolio to the highest 10 firms on the Nasdaq trade, whereas the rest is distributed among the many different 90 firms.

Nonetheless, 0.1% of a $352 billion pie remains to be vital.

It’s not all optimistic information

Whereas the Nasdaq’s annual rebalancing will embrace MicroStrategy, the standards for firms’ inclusion within the index is the most important supply of their market worth.

MicroStrategy stays a supplier of enterprise intelligence expertise and options, nonetheless, if a larger a part of its worth comes from its Bitcoin holdings, then it may very well be reclassified as a monetary firm and faraway from the Nasdaq 100.

Bitcoin trades at $102,800 as of publishing whereas Nasdaq’s rebalancing will take impact on Dec. 23.