Convertible Preferred Stock

Preferred stock convertible into common shares, blending dividend income with equity conversion potential.

What is Convertible Preferred Stock?

Convertible preferred stock offers fixed dividends with the option to convert into common stock at a set ratio, providing downside protection and upside participation. In Strategy’s case, STRK exemplifies this, with 8% dividends and conversion at $1,000 strike, raising $744 million by March 2025.

It embeds call options, sensitive to volatility, with Strategy using it to minimize common dilution while funding Bitcoin.