JP Morgan: Strategy's potential MSCI exclusion already priced in, limiting downside

JP Morgan stated in a recent report that the impact would be limited even if MSCI excludes companies with digital asset treasuries (DATs), such as Strategy, from its indices, arguing that the possibility has already been largely priced in by the market. Strategy's stock price fell 40% between MSCI's announcement in October that it was reviewing the matter and Dec. 2. The report described the current market price as reflecting the potential for exclusion from all major indices. While MSCI's final decision is the most critical variable for the price movements of both Strategy and Bitcoin, JP Morgan projects that downside pressure would be limited even with a negative outcome. Conversely, if Strategy remains in the index, its stock could rebound strongly to the price levels seen before the major sell-off on Oct. 10.