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Strategy's variable-rate perpetual preferred stock STRC closed at $89 on Friday, touching an intraday low of $88.51 — a record low that pushes its year-to-date decline to roughly 10.7%. The issue carries a stated amount of $100 per share, leaving it trading at about an 11% discount to par.
Why it matters
STRC pays an annualized dividend of 11.50%, adjusted monthly, and Strategy has previously said the rate is calibrated to keep the stock trading close to $100. The fact that it's now persistently below par suggests the dividend isn't fully compensating holders for the credit and duration risk of a preferred-stock issuer whose entire investment thesis rests on Bitcoin. The disconnect between the 11.5% yield and the 11% price gap is the structural tell — at par the yield would still be ~10.4%, but the market is now pricing meaningful risk that the rate gets cut, the company misses, or BTC itself falters.
Market impact
The slide lands at a sensitive moment for Strategy's capital stack. Preferred dividend coverage is a recurring flashpoint for the equity, and an STRC trading well below par tightens the company's effective cost of capital on any future issuance of similar instruments. Watch the next monthly dividend reset and any commentary from management on whether the 11.5% rate stays put or moves higher to defend the price.
Source: [STRC Information — Strategy](https://www.strategy.com/strc/learn)
Frequently asked questions
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What is Strategy's STRC preferred stock?
STRC is Strategy's variable-rate perpetual preferred stock with a $100 stated amount per share. It pays an annualized dividend of 11.50%, adjusted monthly, and was designed to trade close to par.
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Why is STRC hitting a record low?
STRC closed at $89, about 11% below its $100 stated amount. Holders are demanding more yield than the 11.5% dividend provides to compensate for credit and duration risk tied to Strategy's Bitcoin-heavy balance sheet.
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How does STRC's price affect Strategy's cost of capital?
Persistent below-par trading signals the market wants a higher yield, which effectively raises what Strategy would need to pay on any future preferred issuance. It also puts pressure on management to defend the price via higher dividend resets.
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Is STRC's decline a signal about Bitcoin?
Indirectly. STRC's risk premium is increasingly tied to BTC volatility because Strategy's solvency thesis depends on Bitcoin. The price gap suggests the market is repricing the preferred for that linkage, not abandoning it.
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What should investors watch next on STRC?
The next monthly dividend reset is the key event — a higher rate would be the company's defense of the $100 level, while a hold at 11.5% would imply management is willing to let the price stay below par.
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