Strategy adds $7B to market cap as short squeeze unfolds

Strategy Inc., the company formerly known as MicroStrategy, saw its market capitalization surge by $7 billion over two days as a short squeeze began to take hold. The catalyst was familiar: Michael Saylor, the company’s executive chairman, publicly signaled that the firm has no plans to offload its massive Bitcoin stash. The most crowded short in large-cap land Strategy earned a distinction earlier this year that most companies would prefer to avoid. It became the most shorted large-cap stock on the planet, with short interest reaching approximately 4% of its total market cap back in February. By late July, the situation had only intensified. Short interest climbed to roughly 9% of the stock’s float, representing about 32.48 million shares. In notional terms, that works out to approximately $3 billion worth of bets against the stock. Analyst Tom Lee flagged this dynamic earlier in the year, noting that bearish investors appeared to have overleveraged their positions against MSTR. The crowded nature of the trade, he suggested, made the stock ripe for exactly the kind of violent upward move that just played out. Saylor’s diamond hands, with asterisks Saylor has been consistent in his...