MicroStrategy's short position reduced to $6.9 billion, nearly a quarter of its market value

Despite a slight decrease in overall bearish sentiment, several institutions still hold a short position worth $6.9 billion against the publicly traded software developer MicroStrategy.

MicroStrategy Continues to Face Bearish Pressure

Fintel's data on major short positions shows that as of June 6th, institutions collectively hold 18 short positions against MicroStrategy, with the largest one being approximately $2.4 billion, totaling around $6.9 billion betting on MicroStrategy's decline.

As a comparison, this represents almost a quarter, 23.4%, of MicroStrategy's market cap of $29.384 billion, while Amazon's largest net short position is $3.59 billion, and the largest net short position in the U.S. is the S&P 500 ETF under SPDR, totaling $114.06 billion.

Previously reported, the short-selling investment firm Kerrisdale Capital released a research report in March this year, stating that MicroStrategy is significantly overvalued compared to Bitcoin, and after the launch of a Bitcoin spot ETF, buying MicroStrategy to gain Bitcoin exposure will be a thing of the past, emphasizing that the era of MicroStrategy's so-called "Bitcoin strategy" has come to an end.

MicroStrategy Criticized by Short-Selling Firm Kerrisdale Capital, Stock Price Plummets by 11%

Bearish Sentiment Weakening

Despite specific institutions betting on a decline in MicroStrategy's stock price, bearish sentiment has significantly weakened. The short interest ratio of MicroStrategy stock has decreased by nearly 50% over the past six months, from 3.1 days to 1.5 days.

This indicator helps traders analyze the risk of short squeeze, showing the average number of days needed for short sellers to close their positions. The fewer the days, the lower the interest of short sellers.

Data shows that MicroStrategy's stock price saw a nearly 47.91% drop in March and April, but still has almost quadrupled with a 277.59% increase since mid-January.

Over the past year, MicroStrategy has surged by around 469%, while Bitcoin has risen by 168% during the same period.