For most of the past 12 months, it’s been better to own bitcoin (BTC) than Strategy (formerly MicroStrategy) stock. Indeed, over the past 250 trading days through yesterday’s close, MSTR has underperformed BTC 90% of the time. Although founder Michael Saylor promotes his common stock as a leveraged play on BTC — and BTC has doubled over the past 12 months — timing is always what makes or breaks an investment. Sure, MSTR has rallied 152% over the past year, which is certainly better than the 98% rally in BTC. However, unless investors held for those entire 12 months or longer, they would have had to have timed their entrances perfectly to outperform BTC. Specifically, MSTR has underperformed BTC for 228 trading days in the past 12 months. MSTR has only outperformed BTC on 22 trading days. Of those 22 rare days, 21 are clustered in September and October 2024. Read more: Michael Saylor continues to dilute MSTR after modifying promise MSTR is a leveraged bet on BTC “MSTR is effectively a levered bet on BTC. That’s what this company has become. Fair?” CNBC TV anchor Andrew Ross Sorkin asked Saylor on Monday. “That’s correct,” Saylor responded unequivocally. “So the question is,” Sorkin continued, “On the way up, it’s fabulous, because everything becomes multiplied. What happens on the way down?” Over the past year, BTC has gone up and down quite a bit. Although MSTR has successfully acted as a leveraged bet on BTC over longer time frames, whether it outperforms BTC on smaller time frames depends on investors’ timing. Ultimately, it should be unsurprising that a leveraged bet on BTC underperforms BTC during bearish or choppy price action. Strategy is a BTC treasury company. Rather than discounted cash flow analysis or revenue multipliers, most investors idiosyncratically value the company based on its BTC holdings and confidence in management to accrete BTC over time on a dilution-adjusted basis. Edit 11:30 UTC, Sept 11: Edited headline for clarity.