Interactive Brokers Secures Spot as Crypto-Linked Firms Face Setback
Shares of Robinhood Markets (HOOD) and MicroStrategy (MSTR) fell in after-hours trading on Monday after both companies were overlooked for inclusion in the S&P 500 index. The coveted spot went instead to Interactive Brokers Group (IBKR), which will replace Walgreens Boots Alliance when the index rebalances this week.
Why Robinhood and MicroStrategy Were Snubbed
The S&P Dow Jones Indices announced that Interactive Brokers would join the benchmark index on Thursday, ending speculation that Robinhood and MicroStrategy might make the cut. Market analysts had expected Robinhood to be a strong candidate, while MicroStrategy recently became eligible after its market cap surged due to rising Bitcoin holdings.
“Currently, Interactive Brokers met the criteria and was selected, while Robinhood and MicroStrategy will have to wait for another opportunity,” BITX market analysts noted.
Following the announcement, Robinhood shares dipped 0.5% in after-hours trading to $107.40, after closing the regular session down 1.26%. The company had previously seen nearly 190% gains this year, driven by retail investor demand.
In contrast, Interactive Brokers gained 3.9% in extended trading to $65.21 after the news of its inclusion.
MicroStrategy, trading as Strategy, also saw losses, ending Monday down 4.17% and sliding another 0.6% after hours to $341. The decline coincided with Bitcoin dropping 2% to just below $110,000, impacting the firm’s valuation as it holds a large Bitcoin treasury.
Being added to the S&P 500 typically boosts a company’s stock as index funds and institutional investors purchase shares to match the benchmark. However, eligibility requires meeting strict criteria, including a market capitalization above $22.7 billion, U.S. incorporation, and minimum liquidity requirements.
While Robinhood and MicroStrategy missed out, Block, Inc. became the latest crypto-linked firm to join the S&P 500 on July 23, signaling that digital asset companies remain in contention for future inclusions.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.