On December 13, the Nasdaq inventory change, based in 1971, which pioneered the idea of digital buying and selling and which hosts lots of the world’s main tech corporations, introduced that on December 23, MicroStrategy Inc., which is without doubt one of the firms listed on the change, would get added to the Nasdaq-100 Index, which is a inventory market index launched in January 1985 that tracks the efficiency of the 100 largest (by market capitalization) non-financial corporations listed on the Nasdaq change.
It’s value stating that Nasdaq-100 and QQQ aren’t the identical — the previous is an index whereas the latter is an exchange-traded fund (ETF). QQQ, which is formally referred to as the Invesco QQQ Belief, is an ETF that tracks the efficiency of the Nasdaq-100 index, offering buyers with a option to get publicity to the corporations within the Nasdaq-100 by way of a single funding product.
Nasdaq additionally introduced that two different corporations can be becoming a member of MicroStrategy on Nasdaq-100: Palantir Applied sciences Inc. (PLTR) and Axon Enterprise, Inc. (Nasdaq: AXON).
Though Nasdaq is greatest identified for being the world’s premier change for tech corporations, in actuality it hosts corporations from a various array of sectors. One other index launched concurrently the Nasdaq-100 is the Nasdaq Monetary-100 Index, which consists of the the 100 largest (by market cap) monetary corporations.
The Nasdaq-100 is reconstituted yearly in December, “timed to coincide with the quadruple witch expiration Friday of the quarter,” with the modifications turning into efficient simply earlier than the market opens, often some date in mid-to-late December.
Getting added to the Nasdaq-100 is a large badge of honor for tech corporations, and it is vitally exhausting to think about MicroStrategy ending up there if it not had been for co-founder (and presently government chairman) Michael Saylor and his sturdy perception in and advocacy for Bitcoin because the agency’s struggling software program enterprise is reporting more and more decrease income and more and more larger losses primarily based on the newest monetary outcomes. For Q3 2024, the agency recorded a income of $116.1 million and a internet lack of $340 million.
So, how come MicroStrategy has a market cap of practically $98 billion? Effectively, that every one comes all the way down to the choice — introduced in August 2020, to undertake Bitcoin (BTC) as a main treasury reserve asset. That is additionally when it disclosed that it had purchased 21,454 bitcoins at an combination buy worth of $250 million. Below Saylor’s management and steering, the agency has wager its future on Bitcoin and repeatedly saved accumulating Bitcoin.
As of December 9, the agency owned 423,650 bitcoins (which has a present worth of round $43 billion, which has been acquired for a complete price of round $25.6 billion, making it the biggest company holder of BTC.
Because of this roughly 46.9% of MicroStrategy’s market capitalization is immediately attributable to its Bitcoin holdings on the present worth. This leaves about 53.1% of the market cap representing the corporate’s core enterprise, different property, and a premium for its Bitcoin technique.
Featured Picture through Pixabay