What Happened?
Shares of bitcoin development company Strategy (NASDAQ:MSTR) jumped 2.1% in the morning session after the company reported a substantial unrealized gain of $3.89 billion on its bitcoin holdings for the third quarter. This gain was detailed in a regulatory filing and came as the price of Bitcoin surged to new all-time highs near $125,000. An unrealized gain is a profit on paper that comes from an asset increasing in value, even if it has not been sold. Strategy's large bet on the cryptocurrency meant its fortunes were closely tied to Bitcoin's rally.
After the initial pop the shares cooled down to $358.78, up 1.9% from previous close.
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What Is The Market Telling Us
Strategy’s shares are extremely volatile and have had 71 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 4 days ago when the stock gained 1.8% on the news that the price of Bitcoin surged, lifting other cryptocurrency-exposed stocks. The software company, which holds a large amount of Bitcoin, saw its shares rise in line with the world's largest cryptocurrency. Bitcoin's price jumped to nearly $119,400, marking a significant gain.
Strategy is up 19.6% since the beginning of the year, but at $358.78 per share, it is still trading 24.3% below its 52-week high of $473.83 from November 2024. Investors who bought $1,000 worth of Strategy’s shares 5 years ago would now be looking at an investment worth $23,912.
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