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EndGame Macro
MSTR Isn’t Trading Cheap It’s Trading Honestly.
This chart is basically a mood ring for how the market feels about MicroStrategy as a Bitcoin proxy. You’ve got the red bars for MSTR’s market cap, the orange bars for the value of their Bitcoin, and the black line showing the ratio between the two, how much of a premium or discount investors are willing to put on the stock compared to the BTC it holds.
Early on, the market paid way above the value of the coins, more than 3x at one point. That wasn’t about fundamentals; that was the story. MSTR was one of the only ways to get outsized BTC exposure through a regular brokerage account, so people treated it like a high beta Bitcoin bet with a cult leader attached.
As time passed, that enthusiasm faded. The ratio slid, even dipped below 1.0x in 2022, meaning the stock was worth less than the BTC it owned. Then sentiment swung again during the next run, and the ratio pushed above 2x.
And now it’s back below 1.0x roughly 0.97x which means the stock trades at a discount to its Bitcoin holdings again. The excitement premium has evaporated.
What That Discount Really Implies
A sub 1.0x ratio tells you the market doesn’t see this as a clean Bitcoin vehicle. It sees the extra baggage…
•There’s debt on the balance sheet and real costs attached to all that BTC.
•Shareholders carry governance and “Saylor risk” you’re not just buying the coins, you’re buying his decisions.
•The software business still exists and adds noise.
•And, crucially, investors now have easier, cleaner, low fee ways to own BTC.
When ETFs exist, and access is simple, the old pay a premium for exposure logic disappears. The wrapper matters now, not just the asset inside it.
My Straightforward Read
People look at this discount and wonder if it’s a buying opportunity or a warning sign. To me, the most grounded interpretation is that this is a regime shift, not a temporary mispricing. MSTR isn’t the only door into Bitcoin anymore, so the market doesn’t feel the need to reward it with a premium. And once that psychology breaks, the stock starts behaving more like a closed end fund…it can trade above or below the value of its assets depending on sentiment, not math.
It could flip back to a premium in a full on mania, the chart shows it’s happened before. But that doesn’t mean it should, or that it will happen just because there’s a gap today.
The market is telling you something simple…You’re not buying cheap BTC.
You’re buying BTC plus leverage, plus liabilities, plus a corporate structure, plus narrative risk.
The discount reflects all of that.
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MSTR Isn’t Trading Cheap It’s Trading Honestly.
This chart is basically a mood ring for how the market feels about MicroStrategy as a Bitcoin proxy. You’ve got the red bars for MSTR’s market cap, the orange bars for the value of their Bitcoin, and the black line showing the ratio between the two, how much of a premium or discount investors are willing to put on the stock compared to the BTC it holds.
Early on, the market paid way above the value of the coins, more than 3x at one point. That wasn’t about fundamentals; that was the story. MSTR was one of the only ways to get outsized BTC exposure through a regular brokerage account, so people treated it like a high beta Bitcoin bet with a cult leader attached.
As time passed, that enthusiasm faded. The ratio slid, even dipped below 1.0x in 2022, meaning the stock was worth less than the BTC it owned. Then sentiment swung again during the next run, and the ratio pushed above 2x.
And now it’s back below 1.0x roughly 0.97x which means the stock trades at a discount to its Bitcoin holdings again. The excitement premium has evaporated.
What That Discount Really Implies
A sub 1.0x ratio tells you the market doesn’t see this as a clean Bitcoin vehicle. It sees the extra baggage…
•There’s debt on the balance sheet and real costs attached to all that BTC.
•Shareholders carry governance and “Saylor risk” you’re not just buying the coins, you’re buying his decisions.
•The software business still exists and adds noise.
•And, crucially, investors now have easier, cleaner, low fee ways to own BTC.
When ETFs exist, and access is simple, the old pay a premium for exposure logic disappears. The wrapper matters now, not just the asset inside it.
My Straightforward Read
People look at this discount and wonder if it’s a buying opportunity or a warning sign. To me, the most grounded interpretation is that this is a regime shift, not a temporary mispricing. MSTR isn’t the only door into Bitcoin anymore, so the market doesn’t feel the need to reward it with a premium. And once that psychology breaks, the stock starts behaving more like a closed end fund…it can trade above or below the value of its assets depending on sentiment, not math.
It could flip back to a premium in a full on mania, the chart shows it’s happened before. But that doesn’t mean it should, or that it will happen just because there’s a gap today.
The market is telling you something simple…You’re not buying cheap BTC.
You’re buying BTC plus leverage, plus liabilities, plus a corporate structure, plus narrative risk.
The discount reflects all of that.
$MSTR market cap is less than the value of its BTC holdings.
Do what you want with this information. https://t.co/OyQPSTgcFo tweet
Offshore
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EndGame Macro
A Quiet Exit From Services Stocks Is Telling a Loud Macro Story
This is the unwinding of a trade that worked incredibly well for three years straight. From 2021 through mid 2024, funds kept piling into consumer services names…travel, leisure, dining because the post Covid boom made them look bulletproof. That overweight kept climbing, peaking near the highest levels of the entire decade.
Now the line is collapsing. Funds aren’t necessarily turning bearish on the whole sector; they’re simply rushing out of a crowded long at the same time. When positioning gets this heavy and then reverses this sharply, it almost always reflects a shift in how managers see the underlying economy, not just the sector.
The Macro Message Behind the Move
The deeper read is pretty simple…the consumer is losing altitude. Not in a dramatic, crisis like way, more in the steady, grinding way that shows up before unemployment rises and before earnings revisions start rolling in. Travel demand is cooling, dining traffic is softer, and households are being more selective. At the same time, these businesses still face high labor costs, elevated rents, and expensive financing. That combination makes the sector extremely sensitive to even small changes in demand.
Hedge funds know this. They’re looking at slower spending, softer labor data, and a yield curve that still hasn’t fully eased on the long end. And they’re asking themselves a practical question…“Why stay overloaded in a cyclical sector right as the economy is losing steam?” What we’re seeing on the chart is their answer…
My View
To me, this is a cycle signal. The reopening and high spend phase is behind us, the consumer is no longer overpowered by savings and stimulus, and investors are starting to reposition for a slower backdrop. If economic data continues to cool, this rotation will look smart. If the consumer finds new life, it may look premature.
But based on the way this curve has turned and how quickly, it feels more like funds are stepping out ahead of a shift rather than chasing a headline. Sometimes the flow tells the story before the data does. This looks like one of those moments.
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A Quiet Exit From Services Stocks Is Telling a Loud Macro Story
This is the unwinding of a trade that worked incredibly well for three years straight. From 2021 through mid 2024, funds kept piling into consumer services names…travel, leisure, dining because the post Covid boom made them look bulletproof. That overweight kept climbing, peaking near the highest levels of the entire decade.
Now the line is collapsing. Funds aren’t necessarily turning bearish on the whole sector; they’re simply rushing out of a crowded long at the same time. When positioning gets this heavy and then reverses this sharply, it almost always reflects a shift in how managers see the underlying economy, not just the sector.
The Macro Message Behind the Move
The deeper read is pretty simple…the consumer is losing altitude. Not in a dramatic, crisis like way, more in the steady, grinding way that shows up before unemployment rises and before earnings revisions start rolling in. Travel demand is cooling, dining traffic is softer, and households are being more selective. At the same time, these businesses still face high labor costs, elevated rents, and expensive financing. That combination makes the sector extremely sensitive to even small changes in demand.
Hedge funds know this. They’re looking at slower spending, softer labor data, and a yield curve that still hasn’t fully eased on the long end. And they’re asking themselves a practical question…“Why stay overloaded in a cyclical sector right as the economy is losing steam?” What we’re seeing on the chart is their answer…
My View
To me, this is a cycle signal. The reopening and high spend phase is behind us, the consumer is no longer overpowered by savings and stimulus, and investors are starting to reposition for a slower backdrop. If economic data continues to cool, this rotation will look smart. If the consumer finds new life, it may look premature.
But based on the way this curve has turned and how quickly, it feels more like funds are stepping out ahead of a shift rather than chasing a headline. Sometimes the flow tells the story before the data does. This looks like one of those moments.
Hedge Funds are dumping consumer services stocks (hotels, restaurants) at the fastest pace in AT LEAST 5 years 🚨🚨 https://t.co/cSEjrbXf1T tweet
Offshore
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EndGame Macro
This is the Fed’s polite way of saying, “There’s a lot more leverage under the hood than people realize.”
What stands out is how fast the prime brokerage and repo lines have climbed over the last few years. Prime broker financing tells you equity books are running bigger and more levered. Repo financing tells you fixed income trades, especially Treasury arbitrage have ballooned. Put together, it shows a market leaning heavily on borrowed money at a time when both volatility and issuance have been rising.
And here’s the part that matters: this kind of leverage works beautifully when everything is calm. It juices returns, smooths spreads, and makes the whole system look more liquid than it really is. But it cuts the other way when conditions shift. If funding tightens, haircuts rise, or volatility jumps, these same trades unwind quickly…not because sentiment changes, but because margin calls force them to.
So the chart is a reminder of how modern markets function…hedge funds provide liquidity, but they also borrow a lot to do it. As long as financing stays easy, this structure holds. When it wobbles, this is exactly where cracks tend to show up first.
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This is the Fed’s polite way of saying, “There’s a lot more leverage under the hood than people realize.”
What stands out is how fast the prime brokerage and repo lines have climbed over the last few years. Prime broker financing tells you equity books are running bigger and more levered. Repo financing tells you fixed income trades, especially Treasury arbitrage have ballooned. Put together, it shows a market leaning heavily on borrowed money at a time when both volatility and issuance have been rising.
And here’s the part that matters: this kind of leverage works beautifully when everything is calm. It juices returns, smooths spreads, and makes the whole system look more liquid than it really is. But it cuts the other way when conditions shift. If funding tightens, haircuts rise, or volatility jumps, these same trades unwind quickly…not because sentiment changes, but because margin calls force them to.
So the chart is a reminder of how modern markets function…hedge funds provide liquidity, but they also borrow a lot to do it. As long as financing stays easy, this structure holds. When it wobbles, this is exactly where cracks tend to show up first.
Hedge funds often augment their investment positions using leverage. The leverage sources can be divided into three categories: prime brokerage, repo, and other secured borrowing. Prime brokerage and repo borrowing have increased rapidly over the past few years, as shown in this chart. Learn more: https://t.co/ep6ItQTBlh tweet
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EndGame Macro
https://t.co/xAJ2xvWTPi
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https://t.co/xAJ2xvWTPi
*FED'S HAMMACK SAYS WORRIED ABOUT THE LABOR MARKET: MARKETWATCH
turning dovish tweet
Offshore
Video
EndGame Macro
RT @APompliano: From the Desk of Anthony Pompliano
0:00 Home Affordability Is Impacting Everything
6:30 Warren Buffett Shares His Final Notes
8:32 Milton Friedman’s Recipe For Economic Policy Success
Enjoy! https://t.co/ex3Sqc9EZ4
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RT @APompliano: From the Desk of Anthony Pompliano
0:00 Home Affordability Is Impacting Everything
6:30 Warren Buffett Shares His Final Notes
8:32 Milton Friedman’s Recipe For Economic Policy Success
Enjoy! https://t.co/ex3Sqc9EZ4
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EndGame Macro
RT @GeorgeGammon: Bitcoin And MSTR Are Crashing (What You Need To Know) https://t.co/457R0Agkdb
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RT @GeorgeGammon: Bitcoin And MSTR Are Crashing (What You Need To Know) https://t.co/457R0Agkdb
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X (formerly Twitter)
George Gammon
Bitcoin And MSTR Are Crashing (What You Need To Know)