Strategy Inc (NASDAQ:MSTR) Shares are trading higher Tuesday morning, rebounding after Monday’s crypto sell-off and the worst weekly tech slump since April. The stock, which has fallen more than 30% in the past month, has been hit hard by Bitcoin (CRYPTO: BTC) crashed below $90,000 and hit a six-month low.
What you need to know: Strategy is now valued almost entirely based on Bitcoin holdings rather than net income. With the company recently deploying another $835.6 million to acquire 8,178 BTC, shareholder value is mathematically linked to the digital asset’s performance.
As a result, when Bitcoin hits a six-month low, MSTR’s balance sheet faces an immediate devaluation, forcing the stock through major support levels near $200.
Despite Ethereum (CRYPTO:ETH) $3,000 losses and broader crypto routes, Michael Saylor remains challenging, stating that the company “always buys” and remains overcollateralized even if Bitcoin were to crash 80%.
While Fundstrats Tom Lee argues that MSTR could eventually become the market leader if Bitcoin recovers; the immediate sell-off of the underlying asset has accelerated volatility.
Benzinga Edge Rankings: Benzinga Edge data highlights the stock’s technical weakness, with MSTR receiving a low Momentum score of 5.82 while identifying negative short-, medium-, and long-term price trends.
Also read: Everyone is optimistic, money is running out – what happens if the Fed doesn’t cut spending?
MSTR Price Action: Strategy shares rose 3.62% to $202.49 at time of publication on Tuesday. According to data from Benzinga Pro, the stock is near a 52-week low of $189.53.
How to buy MSTR stock
By now you’re probably curious about how you can participate in the strategy market – whether it’s buying shares or even trying to bet against the company.
Buying shares is usually done through a securities account. A list of possible trading platforms can be found here. Many allow you to purchase “fractional shares,” which allow you to own portions of the stock without purchasing an entire share.
In the case of Strategy, which is trading at $206.85 at the time of publication, $100 would buy you 0.48 shares.
If you want to bet against a company, the process is more complex. You’ll need access to an options trading platform, or a broker that allows you to short a share of the stock by lending you the stock to sell. The process of shorting a stock can be found on this resource. Otherwise, if your broker allows you to trade options, you can buy a put option, or sell a call option at a strike price higher than where the stock is currently trading. Either way, you can benefit from the stock price drop.
Image: Shutterstock
#Bitcoin #Plunges #SixMonth #Strategy #Investors #MSTR #Feeling #Pain #Strategy #NASDAQMSTR