Retail investors in the US have adopted divergent strategies in November, aggressively buying stocks while offloading cryptocurrency ETFs. According to data, retail investors have sold approximately $4 billion worth of spot Bitcoin and Ethereum ETFs this month, setting a new record for monthly outflows. Meanwhile, global equity ETFs have seen net inflows of $96 billion, signaling strong demand for stocks.

JPMorgan notes that this selective behavior suggests retail investors do not view the crypto market downturn as a broader shift in risk assets. Bitcoin has fallen below its estimated production cost of $94,000 for the first time since July 2020, indicating weakened miner support for prices.

In contrast, equity ETF inflows remain robust, with $96 billion added month-to-date (MTD). If this pace continues, November could see total inflows of $160 billion, matching the strong performance of September and October. However, speculative retail activity has declined, as seen in reduced options trading and underperformance of meme stocks relative to the S&P 500.

MicroStrategy, often seen as a Bitcoin proxy stock, faces potential exclusion from major indices like MSCI, which could trigger up to $8.8 billion in passive outflows. A decision by MSCI is expected on January 15, posing a critical risk for the company. Its valuation premium relative to its Bitcoin holdings has narrowed significantly, reflecting market concerns.

The divergence in retail behavior highlights that investors treat crypto and equities as distinct asset classes. While stocks continue to attract inflows, crypto ETFs have seen concentrated selling in February, March, and November.

Market participants should closely monitor the MSCI decision, as exclusion could further pressure MicroStrategy’s valuation and liquidity. The stock’s premium to its Bitcoin holdings is already at pandemic-era lows, with potential downside if index providers take action.