JPMorgan (JPM) Raised Its Strategy (MSTR) Stake 36% to 848,932 Shares Before MSCI Exit

A Larger Stake and a Larger Hedge

JPMorgan Chase (JPM) held 848,932 shares of Strategy (MSTR) at the end of September, 36% more than the 624,387 it disclosed for June, according to the quarterly 13F filing the bank lodged with the U.S. Securities and Exchange Commission (SEC) on Thursday. At the September 30 valuation, the position was worth $131.3 million. The same filing lists put options on the company, contracts that pay off when the underlying stock loses value, covering 1,148,500 shares, a 60% increase from the 715,700 recorded in June. The hedge now outweighs the outright holding: the put coverage exceeds the 848,932 shares the bank reported owning. Put options work like insurance, since the holder pays a premium for the right to sell the shares at a fixed price, so a bigger put book means a bigger payout if the stock keeps sliding. Both sides of the book grew in the same quarter, with the bank adding shares and protection simultaneously.

A 13F is the quarterly holdings disclosure large US money managers must file with regulators, and it reports positions as of the final day of the quarter, so the numbers describe the book as it stood weeks before MSCI confirmed the index removal on Wednesday. The June comparison comes from the bank's previous 13F, covering the quarter that ended June 30. Option positions in a 13F are converted into share equivalents, which is why the put line reads as coverage for 1,148,500 shares. The report pools JPMorgan with 17 affiliates, which means the line items may combine client accounts with trading inventory, and the filing does not explain whether the shares and the puts belong to the bank, to its clients or to both. Strategy, the company formerly known as MicroStrategy, is the largest corporate holder of Bitcoin, so the enlarged stake also gives the bank indirect exposure to the cryptocurrency's price.

MSCI Sets a Nov. 30 Exit Date

MSCI confirmed on Wednesday that Strategy will leave its US indexes, the result of a methodology change under which companies that mostly hold assets, rather than run operating businesses, no longer qualify for inclusion. The decision followed a second round of consultation with market participants, in which Strategy and other issuers argued their case. Index funds do not make exceptions. Their mandates require them to replicate the benchmark, so a deleted constituent is sold regardless of any view on its fundamentals. JPMorgan's analysts put the exposure in billions: their estimate was that exclusion could push passive funds to unload roughly $2.8 billion of the shares, with the forced selling due on Nov. 30. Strategy pushed back before the decision was finalized. In an August 31 letter to MSCI, the company called the proposal misguided and flawed, and argued that it “conflicts with established securities laws and accounting principles.” Founder and chair Michael Saylor made the case more bluntly on X, writing that the index provider “should be a mirror of the market”, not its judge. The market had already priced in part of the risk: the shares fell about 6% on Thursday and finished the US session near $115. At that level, JPMorgan's September stake would be worth roughly $97.6 million, down from the $131.3 million recorded at the end of the quarter. Wall Street has not turned on the stock. Twelve of the 13 analysts tracked rate Strategy a buy, with an average price target of $217.92. Other large managers must file their own September 13Fs by Nov. 16, a disclosure that will show whether institutions beyond JPMorgan added to the stock, bought protection against it, or did both.

Support at $110.36 Has Not Been Tested

Strategy's stock closed the US session at $114.77, down 6.5% over 24 hours, and COINOTAG's composite scoring places the nearest support at $110.36, scored 88/100, with resistance at $122.65 rated 89/100. Thursday's range ran from $112.64 to $122.79, so trading pushed through the $122.65 ceiling intraday before retreating, but has not come near testing the $110.36 floor. Momentum is weak: the daily RSI sits at 33.0 and the MACD signal is bearish, consistent with the downtrend on the daily chart. In derivatives, stock perpetuals on Strategy carry about $91.4 million of open interest, with a funding rate of 0.0180% per interval. JPMorgan's own shares held near $343.95, up 0.1% over the same window, so the damage is concentrated in the position, not the holder.