MSCI to Remove Strategy From Its Indexes, Opening Prospect of $8.8 Billion in Outflows
Key Facts
MSCI has decided to remove Strategy and other companies from its global indexes after concluding that their nature is closer to investment funds than operating companies, Reuters reported. The decision will cover the MSCI USA and MSCI World indexes, with the changes taking effect at the close on November 30, 2026. Index membership gives companies’ shares access to passive funds and investors that track the benchmarks, which are required to hold the included stocks. The removal could therefore limit index-linked investment flows into Strategy. The decision follows MSCI’s adoption of new eligibility rules for non-operating companies in its November review.
The decision marks a shift from MSCI’s position in January 2026, when it decided not to apply a proposal to exclude digital asset treasury companies in its February review, while opening a broader consultation on non-operating companies. On October 15, the company announced rules classifying non-operating companies as ineligible for its global indexes. The rules will also apply to the MSCI US index series starting with the November 2026 review. The process begins with a screen for operating assets, then uses five financial metrics for companies that do not pass the initial screen. A security becomes ineligible if it records four or more violations, while an existing constituent is removed only if it fails the eligibility test in each of the last two annual reporting periods.
Strategy was not the only company on the removal list; it also included Japan-listed Metaplanet, which buys and holds bitcoin, and U.K.-based uranium purchaser Yellow Cake, Reuters reported. In its response to the consultation, Strategy said funds tracking the MSCI GIMI indexes held only 3.1% of its outstanding shares. It added that about 13 million shares were tracked by funds linked to those indexes, a volume the company said was less than one day of trading in its stock. The company opposed the proposal, saying its bitcoin business is presented as an operating segment under U.S. accounting principles, consistent with discussions with staff at the U.S. Securities and Exchange Commission. Strategy said the proposal would not materially affect it, while MSCI said some digital asset treasury companies display characteristics similar to investment funds.
Strategy shares fell 2.5% in extended trading on Wednesday, November 11, 2026, Reuters reported. The stock closed at $122.35 in the same session, according to EL7 data. The shares had fallen about 20% year to date through November 11, while bitcoin was down 15% over the same period, according to a Reuters report. Bitcoin also closed at $74,015.19 on November 11, according to EL7 data. These moves place the decision against a backdrop of declines in the stock and the asset underpinning the company’s investment strategy, as investors await the impact of the index rebalancing on its effective date.
J.P. Morgan previously estimated that outflows from Strategy shares could reach $8.8 billion if other index providers followed MSCI; the figure remains a conditional scenario, not confirmed flows. Strategy had warned the previous year that exclusion could trigger the liquidation of $2.8 billion in shares and might "discourage" the sector. MSCI is due to publish its additions and deletions lists after 11:00 p.m. Central European Time on November 11, with changes from the November review taking effect at the close on November 30. The implementation date leaves a period between the decision announcement and the actual rebalancing of portfolios linked to the two indexes. Investors’ next step will be to monitor the review lists and implementation on the scheduled date.