how to buy microstrategy preferred stock

How to Buy MicroStrategy Preferred Stock (STRK)

Keyword note: This article explains how to buy microstrategy preferred stock and walks through primary-offering participation and secondary-market buying for retail and institutional investors.

Introduction

If you want to know how to buy microstrategy preferred stock, this article gives a step-by-step, beginner-friendly walkthrough. You’ll learn what STRK (MicroStrategy’s Series A Perpetual “Strike” Preferred Stock) is, the key economic and legal terms to read in the prospectus, how the offering was launched, practical routes to acquire shares (primary allocation vs secondary-market trading), brokerage and execution considerations, risks, and where to confirm official details before trading. Read on to understand how to buy microstrategy preferred stock safely and what to check before you place an order.

As of Jan 31, 2025, according to MicroStrategy’s press release and prospectus supplement, the company priced and settled a primary offering for Series A Perpetual "Strike" Preferred Stock that is expected to list on Nasdaq under the ticker STRK. As of Jan 27, 2025, according to the original company filing, MicroStrategy announced the proposed offering and disclosed that proceeds could be used for general corporate purposes including the acquisition of bitcoin.

H2: Quick summary of the security

• Ticker: STRK (Nasdaq listing planned).
• Security type: Series A Perpetual Preferred Stock ("Strike" preferred).
• Dividend: Stated fixed dividend rate disclosed at 8.00% in filings (paid quarterly), with company election on payment form (cash, shares of Class A common, or combination).
• Conversion: Initial conversion rate disclosed as 0.1000 shares of MicroStrategy Class A common per preferred share (implying an initial conversion price of $1,000 per common share); conversion windows and adjustments described in the prospectus supplement.
• Liquidation preference: $100 per preferred share as disclosed in offering documents.
• Listing/exchange: Planned Nasdaq listing under STRK; typical U.S. equity settlement (T+2).

Why investors buy this preferred

Investors may buy microstrategy preferred stock for income (the stated dividend yield) and for optionality — a conversion feature into MicroStrategy Class A common stock provides potential upside tied to the common (and indirectly, to the company’s bitcoin exposure). The security blends income characteristics (preferred dividends) with limited equity participation (conversion rights) while ranking senior to common stock for distributions and liquidations.

H2: Key terms and mechanics (what to read in the prospectus)

When considering how to buy microstrategy preferred stock, the prospectus supplement and base prospectus are your authoritative sources. Below are the key mechanics to check and how they typically affect investors.

H3: Dividend and payment mechanics

• Stated dividend rate: The offering documents announced an initial stated fixed dividend rate at 8.00% (disclosed in the prospectus supplement). This rate is a stated annual percentage applied to the $100 liquidation preference per share.
• Payment schedule: Dividends are scheduled to be paid quarterly. The exact record and payment dates are set forth in the prospectus supplement and by corporate resolution.
• Discretion and payment form: Dividend payments are discretionary; dividends are payable only if and when declared by MicroStrategy’s board and in accordance with the terms of the preferred. The company may, at its sole election, pay dividends in cash, shares of MicroStrategy Class A common stock, or a combination of cash and shares. This election mechanism affects tax and cash-flow expectations and is detailed in the prospectus supplement.

H3: Conversion terms

• Initial conversion rate: The initial conversion rate was disclosed as 0.1000 shares of MicroStrategy Class A common per preferred share. This implies an initial conversion price of $1,000 per common share ($100 liquidation preference divided by 0.1000 shares).
• Conversion windows and limitations: The prospectus describes permitted conversion periods (for example, conversion at any time, or only during specified windows) and any conditions that must be satisfied for conversion to occur. Some preferred shares allow holder-initiated conversion subject to blackout periods or issuer conditions; read the prospectus to confirm whether conversion is unconditional, subject to a minimum conversion value, or limited by other terms.
• Adjustments for corporate events: The conversion rate may be adjusted for stock splits, reverse splits, reclassifications, dividends of securities, or other fundamental corporate events. The prospectus contains a formula for adjustments; pay attention to anti-dilution protections, if any.

H3: Liquidation and redemption rights

• Liquidation preference: Each preferred share has a stated liquidation preference of $100 per share. In the event of voluntary or involuntary liquidation, dissolution or winding up of the company, preferred holders receive a distribution equal to the liquidation preference per share before any distribution to holders of Class A common.
• Redemption rights and issuer call: MicroStrategy has the right to redeem all (but not less than all) of the outstanding preferred shares under specified conditions described in the offering documents. The issuer’s redemption right typically includes a stated redemption price and may be exercisable only after a defined period or upon specific corporate events. Note: the issuer may not be required to redeem a portion of the preferred; full redemption provisions differ by issuance.
• Holder repurchase rights on fundamental change: Holders may have a limited right to require repurchase of their preferred shares at specified prices upon certain fundamental changes (as defined in the prospectus). The exact terms, notice periods and repurchase price calculations are in the prospectus supplement.

H3: Ranking and credit considerations

• Seniority: Preferred stock ranks senior to MicroStrategy’s Class A common stock for distributions and liquidation preference. However, preferred is junior to all forms of corporate debt (senior secured, unsecured, subordinated debt) and thus has a lower priority than bondholders in bankruptcy.
• Collateral and bitcoin exposure: The preferred shares are not collateralized by bitcoin holdings or other specific assets. Preferred holders have a corporate claim, not a direct claim on bitcoin on the company’s balance sheet. Assess the company’s credit profile, balance sheet strength, and the implications if bitcoin volatility affects MicroStrategy’s business.

H2: How the offering was launched (timeline & context)

• Jan 27, 2025: MicroStrategy announced a proposed offering of Series A Perpetual Preferred Stock in regulatory filings (registration statement/prospectus supplement). The filing disclosed the proposed terms, intended listing on Nasdaq under STRK, and that proceeds could be used for general corporate purposes including potential bitcoin acquisitions.
• Jan 31, 2025: MicroStrategy issued a press release and prospectus supplement reporting the pricing and settlement timing for the offering; the press release included final pricing terms and stated settlement dates. As of Jan 31, 2025, according to MicroStrategy’s press release, the offering was priced and expected to list on Nasdaq under ticker STRK.

Context and use of proceeds

MicroStrategy disclosed that proceeds from the offering may be used for general corporate purposes, which the company has historically defined to include purchases of bitcoin. The prospectus supplement describes permitted uses in more detail. Investors should review those sections to confirm how the company intends to use funds and whether bitcoin purchases or other strategic deployments could affect risk and volatility.

H2: How to buy — step-by-step

This section explains the two main routes for acquiring STRK: primary offering participation (allocation) and buying on the secondary market after listing. For most retail investors, secondary-market purchase is the common route.

H3: Primary offering / IPO allocation route

1. Read the prospectus supplement: Before attempting to participate in the primary offering, read the final prospectus supplement and the base prospectus. The supplement describes who can participate and allocation mechanics.
2. Identify participating brokers: If retail participation is permitted, certain broker-dealers and platforms may accept indications of interest from retail customers. Brokers participating in the underwriting syndicate or providing IPO access may permit retail indications of interest. (Some brokers were referenced in company materials as examples; check current broker disclosures and your broker’s IPO channel.)
3. Submit an indication of interest: If your broker supports IPO participation, you may submit an indication of interest for a specified number of preferred shares before pricing. Indications are not binding allocations; actual allocations are determined by the underwriting syndicate.
4. Allocation and settlement: If you receive an allocation, your broker will notify you of the allocated shares and expected settlement date. Be prepared to have sufficient funds or margin capacity in your account to settle on the stated date.
5. Allocation is not guaranteed: Even with an indication of interest, retail allocations are often limited. Institutional investors and syndicate members typically receive priority. Retail investors should not assume an allocation.

Note: When preparing to participate in a primary offering, confirm any broker-specific eligibility requirements, minimum account balances, or special enrollment needed to access IPO/primary offerings.

H3: Secondary-market purchase (most common for retail)

How to buy microstrategy preferred stock on the exchange after listing:

1. Open a brokerage account that supports Nasdaq-listed securities: Most full-service and many discount brokers support Nasdaq trades, including trades in listed preferred stock. If you do not already have an account, open one with a broker that offers access to Nasdaq equities and allows trading of preferred securities.
2. Confirm account readiness: Make sure your account is funded or margin-enabled if you intend to use margin. Some brokers have minimum funding or margin requirements for trading certain securities.
3. Search the ticker: Once STRK is listed, search for the ticker symbol STRK in your broker’s platform. Verify the security description (Series A Perpetual Preferred) and the associated CUSIP to ensure you have the correct instrument.
4. Choose an order type: You can place a market order (executes at the prevailing market price) or a limit order (executes only at or better than your specified price). For newly listed preferreds that may be thinly traded, a limit order is often safer to avoid large price slippage.
5. Place the trade during market hours: Regular market hours for Nasdaq-listed equities are typically 9:30 a.m.–4:00 p.m. ET. Be mindful of volatility and liquidity; trading at open or close can mean wider spreads.
6. Settlement: U.S. equity trades settle on a T+2 basis (trade date plus two business days). Ensure funds are available for settlement, and confirm your broker’s trade confirmations and settlement notices.

H3: Practical checklist before buying

Before you buy microstrategy preferred stock, go through this checklist:

• Read the prospectus/prospectus supplement and any issuer press releases to confirm final terms (dividend rate, conversion rate, liquidation preference).
• Note ticker symbol (STRK) and CUSIP for trade accuracy.
• Check current liquidity metrics: average daily volume, typical bid-ask spreads, and order book depth via your broker or market data provider.
• Confirm dividend record and payment dates, and the form in which the issuer may pay dividends (cash vs shares).
• Review broker fees, commissions, and odd-lot or large-block trading terms.
• Verify margin eligibility, shorting restrictions, and any broker-imposed limitations for preferred securities.
• Consider tax implications and consult a tax advisor as needed.
• Confirm that you understand conversion mechanics and any timing or blackout periods.

H2: Brokerage & execution considerations

H3: Which broker types and account requirements

• Retail brokers: Many full-service and discount brokers list Nasdaq preferreds. When choosing a broker to buy microstrategy preferred stock, confirm that the broker allows transactions in listed preferred securities and provides accurate market data and order routing.
• Margin vs cash accounts: Some brokers may require margin accounts to participate in certain IPO allocations or to short securities. For secondary-market purchases, a cash account is sufficient for buy-only trades, but settlement timing rules still apply.
• IPO-access requirements: Brokers that offer IPO access may impose eligibility requirements (account age, minimum balance, or trading activity). Check your broker’s IPO participation terms early.
• Institutional access: Institutional investors typically access primary offerings via broker-dealer syndicates or as part of an allocation process. Institutional routes differ from retail channels and often involve separate negotiation and settlement procedures.

H3: Order types and timing

• Market vs limit orders: Market orders for new preferreds can execute at wide spreads if liquidity is low. Use limit orders to control execution price. A limit order reduces the risk of paying an unexpectedly high price in thin markets.
• Impact of low liquidity: Newly listed preferreds sometimes trade with low volume and wide bid-ask spreads. Expect possible execution delays and elevated transaction costs. When placing large orders, consider working the order in smaller lots to reduce market impact.
• After-hours and pre-market trading: While Nasdaq supports extended hours trading, many preferred securities have limited or no extended-hours liquidity. Execution quality may be poorer outside regular hours.

H3: Fees, commissions and odd-lot/trading considerations

• Broker commissions: Confirm commissions, exchange fees and any platform-specific charges. Many brokers offer commission-free trading for standard equities but may apply special fees for less-liquid or odd-lot trades.
• Odd-lot and block trades: Odd-lot orders (less than 100 shares) may trade at different price increments and can face lower priority. Block trades may require special handling; consult your broker for block execution options.
• Market data fees: Some detailed liquidity metrics (depth-of-book) may be available only to paying clients or institutional customers.

H2: Risks and due diligence

This section summarizes security-specific, market, liquidity, and tax-related risks you should weigh when deciding how to buy microstrategy preferred stock.

H3: Security-specific risks

• Dividend non-payment risk: Dividends on preferred shares are payable only if declared by the issuer. The board has discretion and may choose to defer or not pay dividends; missed dividends can substantially affect expected income.
• Subordination to debt: Preferred stock is junior to corporate debt; in a liquidation or bankruptcy, preferred holders are behind bondholders and creditors.
• Conversion economics: At issuance, conversion may be far out-of-the-money depending on the prevailing price of MicroStrategy Class A common; conversion may offer little practical upside if the common does not appreciate sufficiently.
• Issuer redemption: The issuer’s right to redeem all shares under specified conditions can limit long-term upside for holders who plan to hold the preferred indefinitely.
• Limited claim on bitcoin assets: Preferred holders do not hold a lien on bitcoin or other specific corporate assets. If MicroStrategy uses proceeds to buy bitcoin, preferred holders still have a general corporate claim, not a secured claim on crypto holdings.

H3: Market & liquidity risks

• Volatility: MicroStrategy’s business has been linked to its bitcoin strategy, which can produce higher stock volatility. Preferred prices may move with the common stock, corporate announcements, or broader crypto-related news.
• Illiquidity for newly issued preferreds: Newly listed preferreds often trade with low daily volume and wide bid-ask spreads. Illiquidity can result in large execution costs and difficulty entering or exiting positions.
• Bid-ask spread risk: Wide spreads increase effective transaction costs. Use limit orders to manage price execution.

H3: Tax considerations

• Dividend taxation: Preferred dividends are generally taxable either as ordinary income or possibly as qualified dividends depending on holding period and issuer specifics. The prospectus may discuss dividend characterization; check your jurisdiction’s tax rules.
• Conversions and capital gains: Converting preferred to common stock may have tax implications. Depending on local tax law, conversion may result in a taxable event or change your cost basis. Consult a tax advisor for your circumstances.

H2: How to evaluate whether STRK fits your portfolio

Deciding whether to buy microstrategy preferred stock requires matching the instrument’s risk-return profile to your investment goals.

• Income vs equity upside: If you prioritize regular income, STRK’s stated dividend may be attractive. If you seek equity-like upside, evaluate the conversion terms and whether conversion economics appear favorable relative to current common stock prices.
• Risk tolerance: Preferred shares sit between debt and equity in the capital structure. They have fragility in stressed scenarios. If you have low tolerance for issuer-specific credit or bitcoin-driven volatility, preferreds may be higher risk than investment-grade corporate bonds.
• Correlation to bitcoin exposure: MicroStrategy’s large bitcoin holdings and strategy mean STRK may show indirect correlation to bitcoin price moves through the company’s common-stock performance. Understand whether you are getting concentrated exposure to a single corporate strategy.
• Comparison to alternatives: Compare yield and risk to other preferred stocks, corporate bonds or high-yield income instruments. Consider credit ratings, liquidity and covenants when comparing.

H2: Frequently asked questions (short answers)

Q: Can I be forced to convert? A: Check the prospectus. Typically conversion events are either holder-initiated or subject to specific issuer-triggered provisions. Some preferreds allow mandatory conversion under certain events (e.g., a fundamental change or a sustained common share price threshold).

Q: Will dividends always be paid? A: No. Dividends are payable only if declared by the board and are discretionary. The company may choose to pay dividends in cash, in shares of Class A common, or a combination, per the prospectus.

Q: How does STRK relate to MicroStrategy’s bitcoin holdings? A: STRK is a corporate preferred security. Holders have a corporate claim on assets and distributions; the preferred is not secured by or directly backed by bitcoin holdings. MicroStrategy’s bitcoin strategy may influence the common stock and, indirectly, preferred prices.

Q: Is STRK safer than MicroStrategy common stock? A: Preferred stock ranks senior to common for dividends and liquidation preference, but it is junior to corporate debt. Preferred may be less volatile than common in some scenarios but has unique risks, including discretionary dividends and limited recovery in insolvency.

Q: Where do I find the final legal terms? A: The final terms are in the issuer’s prospectus supplement, the registration statement, and subsequent SEC filings. Always read those documents before trading.

H2: Example timeline / practical example (primary vs secondary)

Primary offering example timeline (hypothetical, based on issuer announcements):

• Day -5 to Day 0: Issuer files registration statement and prospectus supplement and announces a proposed offering (e.g., Jan 27, 2025 filing).
• Day 0 (pricing day): Underwriters price the offering and announce final terms (e.g., Jan 31, 2025 pricing press release).
• Day +1 to +3: Settlement date for primary sale; allocated shares are credited to receiving brokers and accounts.
• Day +2 to +4: Nasdaq listing and first secondary-market trade (timing varies by settlement and listing coordination).

Secondary-market practical example:

• Listing day (first public trading day): STRK begins trading on Nasdaq at market open (verify ticker and CUSIP).
• Retail investor places a limit order for STRK via broker; order may fill partially or remain unfilled depending on liquidity.
• Trade confirmation and T+2 settlement; dividend accruals and record dates apply per prospectus.

Notes: Primary allocations are often limited; many retail investors obtain STRK through secondary markets after listing rather than through primary allocation.

H2: Where to find official documents and real-time info

Before you buy microstrategy preferred stock, confirm terms and market data using authoritative sources:

• Company press releases and investor relations materials (for offering announcements and pricing disclosures).
• Prospectus supplement and base prospectus (final legal terms and conversion, dividend, redemption mechanics).
• SEC filings (Form S-3 registration, prospectus supplement, 8-K filings often include final pricing and settlement notices).
• Nasdaq listing page and official ticker information for STRK (confirm listing and market start date).
• Real-time quotes and market depth from your broker or market data provider.

Always cross-check issuer filings for the final terms before trading. When in doubt, consult your broker or a licensed financial advisor.

H2: References and further reading

Primary sources for final offering details (examples to consult):

• MicroStrategy press releases and investor relations announcements describing the proposed offering and final pricing (Jan 27–31, 2025 filings and press releases).
• Prospectus supplement and registration statement filed with the SEC for the Series A Perpetual Preferred Stock.
• Nasdaq press release confirming listing and ticker symbol STRK and summarizing offering terms.
• Media coverage and market commentary (Barron’s, The Block, Cointelegraph, Barchart, TradingView) for context on market reception and liquidity notes.

Reminder: Always read the issuer’s prospectus supplement prior to trading; this article is a guide and not investment advice.

H2: Appendix: Glossary of terms used in this article

• Preferred stock: A class of shares with priority over common stock for dividends and liquidation distributions, often with fixed dividends and limited voting rights.
• Liquidation preference: The stated amount per preferred share to be paid to preferred holders before any distribution to common shareholders in liquidation.
• Conversion rate: The number of common shares that each preferred share can be converted into; adjustments occur for corporate events per the prospectus.
• Perpetual: A security with no scheduled maturity date; redemption or call provisions specify if the issuer can redeem at its option.
• Redemption: The issuer’s right to repurchase or "call" the preferred shares under specified terms.
• Prospectus supplement: The document that supplements a base prospectus and provides final terms and risk disclosures for a particular offering.
• Record date: The date used to determine which shareholders are eligible to receive a declared dividend.

H2: Sources used

• MicroStrategy press release(s) and prospectus supplement announcing the STRK offering and pricing (reported Jan 27–31, 2025). As of Jan 31, 2025, according to MicroStrategy’s press release, the offering was priced and settlement timing was announced.
• Nasdaq press release summarizing the STRK pricing and terms (reported Jan 31, 2025).
• Media coverage and commentary from reputable outlets (Barron’s, The Block, Cointelegraph, TradingView, Barchart) on market reception and broker-access notes (reported Jan 27–31, 2025).

Notes on reported metrics and verification

• Market capitalization and daily trading volume: Check live market data via your broker or market-data provider for up-to-date market cap and average daily volume after STRK lists.
• On-chain or crypto metrics: For data on MicroStrategy’s bitcoin holdings or chain metrics, consult issuer filings and public bitcoin custody disclosures; verify amounts and dates in SEC reports.
• Security of funds and custodial notes: Preferred shares are corporate equity instruments held in brokerage custody. For crypto custody or wallet needs related to bitcoin exposure or other assets, consider Bitget Wallet for custody and management solutions.

Important disclaimers and call to action

This article explains how to buy microstrategy preferred stock and provides educational information only. It is not financial, tax, or investment advice. Before making any investment decision, read the issuer’s final prospectus supplement and consult your broker or a licensed financial advisor for personalized guidance. If you want to trade or custody assets, explore Bitget’s brokerage and Bitget Wallet services for account setup, market access and secure wallet options.

Further exploration

• Read the final prospectus supplement for STRK.
• Check your broker’s IPO or primary-access channels if you wish to participate in future primary offerings.
• Monitor Nasdaq listing notices for STRK and confirm ticker/CUSIP before trading.

Thank you for reading this guide on how to buy microstrategy preferred stock. For more on trading tools and custody solutions, explore Bitget’s platform features and Bitget Wallet.