Strategy, formerly MicroStrategy, was not admitted to the S&P 500 despite the company meeting the criteria for inclusion. Robinhood instead took an unexpected spot, sending Strategy shares lower while Robinhood surged.
Michael Saylor’s Bitcoin-focused company, Strategy Inc., on Friday lost the chance to become part of the S&P 500 index, even though it met requirements for market capitalization and liquidity. In contrast, Robinhood and two other companies were included, which immediately affected investor sentiment.
After hours, Strategy shares fell nearly 3 percent, erasing Friday’s earlier gains and denting investor hopes. At the same time, Robinhood rose about 7 percent ahead of its effective index inclusion date, set for September 22.
Investors believed that if Strategy had been added to the S&P 500, it would have been a big turning point for the stock market’s acceptance of crypto-related companies. With the company holding one of the largest Bitcoin treasuries and posting a strong quarter, many saw index inclusion as a near certainty. The exclusion highlights that S&P’s selection committee considers broader qualitative factors beyond technical eligibility.
Robinhood’s unexpected elevation joined other additions like AppLovin and Emcor Group, emphasizing S&P’s preference for businesses perceived as less volatile and more aligned with traditional structures. Inclusion often triggers passive investment flows from index-tracking funds, which may explain Robinhood’s stock jump and Strategy’s lagging performance.
As the largest corporate Bitcoin holder, Strategy’s exclusion undercuts its bid for mainstream capital markets recognition. Analysts note that despite strong fundamentals and substantial Bitcoin ownership, the company’s close tether to crypto volatility may deter the index committee.
Moreover, Strategy’s recent policy shift to allow equity issuance below its market-to-net asset value threshold (mNAV) aimed to bolster flexibility in funding Bitcoin purchases. Still, critics argue this may dilute shareholder value and hasn't gained committee favor.
Benchmark analyst Mark Palmer maintains a bullish outlook, reiterating a strong buy rating and a $705 target, arguing that Strategy remains the most liquid and direct proxy for Bitcoin exposure, though absent S&P 500 inclusion, mainstream investor access remains limited .
If Strategy eventually gains admission, it would join crypto-adjacent leaders Coinbase and Block in exposing S&P 500 investors to digital asset-linked equities. But for now, regulatory caution and committee discretion prevail in sidelining one of crypto’s most emblematic firms.
