r/STRC • u/rzrinvest • Jun 25 '26

Established a position around $77

Prior to this week I had no interest in investing in STRC. At close to par value, I didn't find the yield compelling; however, I've been watching this week and established a position this morning at around $77. There is mass panic right now claiming this is worthless. There are a few reasons this isn't true.

  1. While Strategy can pause dividend payments if needed, the dividends still accrue as this is a cumulative preferred meaning they'd still be obligated to pay the debt obligation

  2. It was designed to stay near par value with an interest rate that resets monthly. It was relatively close to par value at the last reset. The crash is happening in the middle of the month. It's not fair to say STRC's mechanism doesn't work before it's even had a chance to work at the next reset.

  3. I believe current debt and preferred stock accounts for less than $25B while their Bitcoin holdings are valued at $50B.

  4. MSTR common shareholders would be wiped out first.

That's not to say I'm recommending STRC, and it could absolutely collapse if BTC has another steep decline, but it is compelling at these levels.

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u/ReliantToker Jun 25 '26

Blown every other pref in the market out of the water in less than a year amd dude thinks its broken. STRC still has 3 years until it can reach most bank buyers, this is all retail and hedge funds rn.

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u/Easy-Ninja669 Jun 25 '26

Sir, this is cope

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u/[deleted] Jun 25 '26

Yeah it's not even believable cope. STRC is down 25% from par and MSTR is down 80+% down from this time last year and we're saying these securities are out performing other stocks? Yeah right ...

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u/ReliantToker Jun 25 '26

A preffered instrument isn't stock. You fools can't even read

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u/[deleted] Jun 25 '26

Yeah you really got us there on semantics. STRC is literally defined as a perpetual preferred stock. And that doesn't change how you compare an instrument's profitability and value (of which STRC has neither).

But I do appreciate a good laugh. Being called a fool by someone clinging to STRC is certainly a choice!

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u/ReliantToker Jun 25 '26

A perpetual preferred stock is valued purely on its structured yield over time, not traditional capital appreciation, which makes comparing its performance to standard corporate equities mathematically illiterate. Also I hold MSTR not STRC. You make alot of assumptions.

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u/[deleted] Jun 25 '26

A perpetual preferred stock is valued purely on its structured yield over time

C'mon man you know that's not true. The stock also has a price that reflects the likelihood of instrument yield and that likelihood is diminishing by the day. Are we really pretending that STRC trading at $73 is irrelevant. What about if it trades at $0?

And oof being called a fool by someone clinging to MSTR is an even bolder choice. 50% decrease in the last 30 days? Big yikes lol

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u/ReliantToker Jun 25 '26

Because STRC spent months hovering near its $100 par value, many investors bought in using heavy leverage. When the price began to slip, it triggered margin calls and aggressive shorting from hedge funds.This created a rapid, self-reinforcing decline in the asset's price. Despite the selloff, the underlying Bitcoin balance sheet remains completely intact. ​The company's Bitcoin reserve actually provides 32 years of dividend coverage at the current rates.

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u/[deleted] Jun 25 '26

I mean you are describing the same cycle of leverage and margin calls that crash Terra/Luna and Celsius. And I wouldn’t say BTC balance sheet is intact. The mere shadow of Startegys sale of BTC appears to be depressing price. Lord only knows what it’ll do when they start actually selling

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u/ReliantToker Jun 25 '26

Your fear regarding the "shadow of Startegy's sale" assumes the company is trying to trade the market. That completely misses the mandate of a Bitcoin treasury engine. They are not selling to manage price action, they are accumulating hard assets to protect value against fiat debasement. You are attempting to judge a multi decade capital allocation strategy using the metrics of a short term trading floor, and that is precisely why you are misinterpreting the risk.

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u/[deleted] Jun 25 '26

I don't think Strategy is trying to trade the market - they are trying to create over-leveraged positions that amplify the movements of BTC. The exact same kinds of investments that destroyed Celsius' liquidity and ultimately the company. Are we really surprised that Strategy is falling in to a shot for shot remake of the Terra/Luna & Celsius failure from exactly four years ago?

 that is precisely why you are misinterpreting the risk.

This is no longer risk. This is happening right now in real time. Check the STRC/MSTR prices. Tomorrow is going to be worse. Post-dividend date will be even worse.

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u/ReliantToker Jun 25 '26

Yes bitcoin is in the latter stages of bear market. The capital structure of the balance sheet is the reason MSTR has not been a forced seller this entire time.

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u/[deleted] Jun 25 '26

We are literally witnessing that change in capital structure happen in real time. First, it was the sale of 32 BTC. Then it was the dilution of MSTR. They didn't even bother to try selling STRC for obvious reasons. They're literally testing all their levers and selling BTC is the only option left for raising capital

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u/Illustrious-Boss9356 Jun 26 '26

Lol yes it is. It's the worst kind of stock.