Strategy (MSTR) the largest corporate holder of bitcoin, with its treasury strategy centered on accumulating BTC as a core reserve asset, has seen its Variable Rate Series A Perpetual Stretch Preferred Stock, STRC, dip below its $100 stated value in pre-market trading following its latest monthly dividend payment, a move that largely reflects routine ex dividend mechanics.
Ex dividend is the date on which a stock begins trading without the right to receive the upcoming dividend, meaning buyers on or after that date will not get the next payout.
STRC currently offers an 11% annualized yield on a $100 stated amount.
Historically, ex dividend price declines have seen price declines by as much as 2% with frequent recoveries back toward par, seen in October and December. However, after the August and November dividend dates, STRC experienced price drops of over 6%, driven by broader volatility, before eventually rebounding.
Recent trading volume and an estimated 40% at the money issuance as a share of total volume, would suggest roughly 2,280 bitcoin have been purchased via STRC proceeds from Monday through to Wednesday.
The bullish case rests on quick recoveries back to $100 or higher, with sustained high volume on dips signaling strong demand for an 11% plus yield.
The bearish case includes prolonged sub $99 pricing, like November, forcing aggressive future rate hikes and an overwhelming supply from continued issuance.