MSCI Rule Puts Strategy at Risk, but $2.8B Estimate Is From an Earlier Proposal

MSCI’s new index screen has put Strategy’s place in global stock benchmarks at risk, but the widely cited $2.8 billion outflow estimate belongs to an earlier proposal and does not measure the rule adopted Oct. 15. The new policy targets companies MSCI classifies as non-operating. It first checks for substantial operating assets, then applies five financial ratios to firms that fail that test. A company must trigger at least four ratios to be ineligible; existing index members must fail in both of their two latest annual filing periods before removal. MSCI plans to publish a list of potentially affected constituents Nov. 11, with changes taking effect after the close Nov. 30.

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