MicroStrategy currently has $6.9 billion in major short positions, with 18 of these listed on Fintel’s “The Big Shorts” list, which tracks the largest short positions disclosed to the SEC. The largest individual short position stands at approximately $2.4 billion, making it the 27th largest net short position among institutions. Despite holding significant short positions against Michael Saylor’s MicroStrategy, institutional investors are showing signs of retreat as the stock price has nearly tripled over the past six months.

The short-interest ratio for MicroStrategy, an indicator of the average number of days short sellers need to close their positions, has plummeted by nearly 50%, from 3.1 days to 1.5 days over the last six months. This decrease implies a waning confidence among short sellers, as the stock’s price has surged from $570 in December 2023 to $1,656 as of June 6, 2024, according to Google Finance data.

MicroStrategy’s stock has seen a 30.57% increase in the past 30 days alone. This sharp rise comes shortly after Kerrisdale Capital, a crypto-skeptic investment firm, raised doubts about the viability of investing in MicroStrategy for Bitcoin exposure following the launch of several spot Bitcoin ETFs. Kerrisdale argued that the unique advantage of holding MicroStrategy shares for Bitcoin exposure had diminished with the new ETFs available.

In an analyst note from March 28, Kerrisdale Capital stated, “The days when MicroStrategy shares represented a rare, unique way to gain access to Bitcoin are long over.” Despite these concerns, MicroStrategy’s stock has significantly outperformed Bitcoin over the past year. MSTR has risen approximately 469%, while Bitcoin has increased by 168% in the same period.