Perpetual Preferred Shares: A New Tool for Investor Protection
In a recent interview, Phong Le, CEO of Strategy, announced plans to issue more perpetual preferred shares to address investor concerns over stock volatility. Le highlighted that this financial product, named 'Stretch,' offers exposure to digital assets while minimizing the risks associated with market fluctuations.
The product resets its dividend rate monthly and currently offers a yield of 11.25%. The company noted that this structure is designed to keep the trading price close to its $100 par value. To date, preferred shares have played a minor role in Strategy’s overall financing strategy.
- About $370 million in common shares issued
- $7 million in perpetual preferred shares raised
These funds have already been used to finance recent Bitcoin purchases over the past three weeks.
In Line With Executive Chairman's Position
Le’s comments align closely with those of Executive Chairman Michael Saylor. In a prior CNBC interview, Saylor dismissed concerns that a drop in Bitcoin prices could force the company to sell its holdings. He reaffirmed that the company intends to continue buying Bitcoin every quarter.