STRC, Strategy Inc.’s variable-rate preferred stock built to hover near $100, instead flirted with the basement Thursday, printing a fresh intraday low near $82.53 before clawing back to close at $88.59.
The move was not some polite tremor in the market’s teacup. STRC traded more than 10 million shares during a volatile session that shoved the security roughly 11% to 17% below its $100 par target, depending on whether investors look at the close or the intraday print.
For a product designed to behave like “digital credit,” the optics were awkward. Strategy, the bitcoin treasury company led by Michael Saylor and formerly known as Microstrategy, created STRC as a perpetual preferred stock with a variable dividend rate that can be adjusted monthly to encourage trading near par.
That mechanism is the grand idea. If STRC trades too low, the dividend rate can rise to lure buyers. If it trades above $100, Strategy can issue more shares through at-the-market programs to add supply and keep upside from running too hot.
The current dividend rate sits at 11.50% annualized, paid semi-monthly in cash after shareholders approved a shift from monthly payments earlier in June. At Thursday’s closing price, the effective yield was roughly 12.98%, the sort of number that makes income investors lean forward and risk managers reach for coffee.
