According to TradingView data on June 26, the 90-day correlation coefficient between Strategy's perpetual preferred stock STRC and Bitcoin surged to nearly 0.70, the highest since the product's launch in July 2025. This month, STRC fell 23% to $76, while Bitcoin dropped nearly 20% to below $60,000, with both moving downward in sync.
STRC Product Design: $100 Par Value, 11.5% Annualized Dividend Yield
STRC is designed as a hybrid product: a floating-rate perpetual preferred stock with a $100 par value, paying monthly cash dividends. The current annualized dividend yield is 11.5% (adjusted monthly by the board to encourage trading near par value). When the stock price exceeds $100, the company can raise funds through an ATM (at-the-market) offering, with proceeds used to purchase more Bitcoin, creating a positive feedback loop.
However, current market conditions are challenging this mechanism: STRC is trading far below its $100 par value (currently at $76), and such a large discount limits the company's ability to raise additional funds to buy Bitcoin.
90-Day Correlation Coefficient at 0.70: Impact of Synchronized Decline with Bitcoin
The 90-day correlation coefficient near 0.70 is the highest since STRC's launch in July 2025, indicating that STRC can no longer decouple from Bitcoin's volatility as it once did. For fixed-income investors, this means the market risk of holding STRC is increasingly close to that of directly holding Bitcoin, rather than traditional preferred stocks or bonds.
Strategy's Recent Bitcoin Sale and Divergent Market Views
Strategy recently sold a small amount of Bitcoin, reportedly to cover STRC dividend payments, marking a significant shift from the company's long-standing "never sell" stance.
Market observers are divided:
· Some investors believe the current discount ($76 vs. $100 par) presents an attractive entry opportunity for yield-seeking capital—offering the potential for both dividend income and capital appreciation once the market recovers.
· Others worry that sustained weakness could pressure Strategy's capital structure, increasing reliance on existing BTC reserves or undermining the positive feedback loop that supports aggressive Bitcoin accumulation.
FAQ
What does a 90-day correlation coefficient of 0.70 for STRC mean?
According to TradingView data, a correlation coefficient of 0.70 indicates a fairly high degree of co-movement between STRC and Bitcoin (1.0 represents perfect positive correlation). For fixed-income investors who initially sought stable returns from STRC's 11.5% annualized dividend yield, this means STRC's volatility risk is closer to direct Bitcoin investment than to a stable instrument like traditional preferred stocks.
Why does STRC trading at a discount limit Strategy's ability to buy Bitcoin?
Under STRC's design, the company can only use ATM offerings to raise funds and purchase more BTC when the stock price is above the $100 par value (maintaining the positive cycle). With STRC falling to $76, below the $100 par value, ATM financing is not economically attractive, thereby restricting the company's channel for new BTC purchases.
Does Strategy's sale of BTC violate its "never sell" pledge?
According to reports, Strategy recently conducted a small BTC sale, allegedly to cover STRC dividend expenses. The article states this "marks a significant shift from its long-standing never-sell stance." Strategy has historically emphasized its long-term commitment to holding Bitcoin, so this sale has drawn market attention, though the amount sold is relatively limited compared to its total holdings of 847,363 BTC.
