Retail Investors Pour in Nearly $11 Million

On Monday, retail investors injected nearly $11 million into MicroStrategy's shares, a figure almost three times their average daily inflows this year. This surge in interest follows the company's inclusion in the Nasdaq-100 index, a move that underscores its status as the largest corporate holder of bitcoin.

Growing Popularity Among Individual Investors

The data, compiled by Vanda Research, reveals a significant increase in MicroStrategy's popularity among individual investors. This comes after the company's stock achieved a remarkable return of nearly 550%, far exceeding the approximately 160% surge of Wall Street favorite Nvidia in 2024.

Bitcoin's Appeal and MicroStrategy's Strategy

Promoted as a financial tool that bypasses government intermediaries, bitcoin often attracts a loyal following among its corporate supporters. Michael Saylor, co-founder and executive chairman of MicroStrategy, is a well-known advocate, frequently sharing his bullish views on crypto with his millions of followers on social media.

The company has also capitalized on the massive rally in bitcoin, which crossed the $100,000 milestone for the first time this month, partly due to the pro-crypto stance of U.S. President-elect Donald Trump.

Analysts' Perspective and Market Dynamics

"Most people wouldn't have a clue what MicroStrategy does as a day-to-day business, yet it has become the stock market's poster child for playing the bitcoin price," noted Dan Coatsworth, investment analyst at AJ Bell.

While MicroStrategy primarily invests in bitcoin, it also sells business analytics software. However, revenue from its software business declined by 10% in the third quarter.

The short interest in the stock has significantly decreased, from 20.7% at the start of 2024 to 12.98% as of December 16, according to Ortex data. This trend often indicates that short sellers, who profit from betting against an asset, are closing out positions to limit losses, thereby potentially boosting prices further.

The average daily retail inflow into MicroStrategy has been $3.75 million so far this year, excluding trading activity via private bankers or savings plans like 401(k), as reported by Vanda Research.