Investors in Strategy Inc. (NASDAQ: MSTR) are feeling the heat as the stock has declined 13.4% in the past month, outpacing Bitcoin’s 6.2% drop. This high beta relationship means Strategy stock moves double what Bitcoin does, leading to potential losses if emotions drive decisions over sound thesis.

Three fundamental reasons suggest investors should consider taking profits on Strategy stock. The company’s business model is heavily tied to Bitcoin’s performance, with the recent decline highlighting the risks. By issuing stock to buy Bitcoin, Strategy has created a leveraged situation that exposes shareholders to potential losses as market sentiment shifts.

Markets are quickly shifting from a risk-on sentiment to one of caution, with growth stocks in the technology sector losing steam. Strategy stock has been hit hard by this rotation, with prices falling over the past month. As the market cools off, investors may want to reconsider their positions in high-risk assets like Strategy.

Strategy’s CFO selling over $10 million in stock raises red flags, with insider transactions totaling $59 million in the latest quarter. The company’s low price-to-book ratio suggests the market has little faith in its assets, comprised mainly of cash raised through stock dilution and Bitcoin bought near all-time highs. Investors may want to proceed with caution.

Read more at Nasdaq: Time to Take Profits on Strategy Stock? 3 Reasons You Should