Glossary
47 terms used in prospectuses, issuer dashboards and this site. Issuer-coined metrics are marked and given with their formula.
A
- Amplification ratio · issuer metric
- Strategy's own ratio of its total bitcoin reserve to its Net Reserve after deducting debt and preferred claims net of USD assets. A higher figure means more of the bitcoin is needed to cover senior claims.
- ATM programme
- An at-the-market programme lets an issuer sell new shares gradually into the open market through sales agents at prevailing prices, instead of in one fixed-price offering. Strategy funds much of its activity this way.
B
- BTC $ Gain · issuer metric
- Strategy's own KPI: the dollar value of its BTC Gain, meaning bitcoin holdings at the start of a period multiplied by BTC Yield, valued at the Coinbase bitcoin price at the end of the period.
- BTC Hurdle ARR · issuer metric
- Strategy's own metric for its current effective cost of credit, expressed as an annual rate. Strategy says that if bitcoin returns more than this rate, Net Bitcoin Per Share grows faster than bitcoin.
- BTC Rating · issuer metric
- Strategy's own coverage multiple for a security: its bitcoin reserve divided by the notional of that security plus everything ranking ahead of it. Strategy states it is not a credit rating from any agency.
- BTC Risk · issuer metric
- Strategy's own modelled probability that a security's BTC Rating falls below 1.0x by the end of its duration, given assumed bitcoin returns and volatility. Strategy states it is not an actuarial or agency risk rating.
- BTC Yield · issuer metric
- Strategy's own KPI: the percentage change over a period in bitcoin held per assumed diluted share (BPS, in sats). It is not a yield in the income sense and is not paid to anyone.
C
- Capital stack
- The full set of an issuer's funding sources (debt, preferred stock and common equity) arranged by seniority. It shows who is paid first and how much sits ahead of any given security.
- Certificate of designations
- The legal document, filed with the issuer's state of incorporation, that creates a series of preferred stock and sets its terms: dividend rate, ranking, redemption, liquidation preference and voting rights.
- Clean-up redemption
- An issuer's right to redeem all of a preferred series once only a small fraction remains outstanding, typically below 25% of the shares ever issued. It lets the issuer retire a small, illiquid remainder.
- Compounding unpaid dividends
- A term under which missed cumulative dividends themselves earn dividends until paid, sometimes at a rate that steps up each period. It raises the cost to the issuer of skipping payments.
- Convertible preferred
- Preferred stock that the holder can exchange for a fixed number of the issuer's common shares. It combines a dividend with exposure to the common share price. STRK is the convertible digital credit series.
- Coverage bridge · issuer metric
- A step-by-step calculation, used in Strategy's investor materials, that shows how the bitcoin reserve compares with the claims ranking at or above a given security, net of USD assets. It produces that security's coverage multiple.
- Cumulative dividend
- A dividend that, if not paid when due, keeps accruing as an amount owed to holders. It must be paid before dividends on junior shares can resume. Most digital credit is cumulative.
D
- Digital credit
- Digital credit is the name Strategy uses for its preferred securities: perpetual, dividend-paying preferred stock issued by a bitcoin treasury company to fund bitcoin purchases. Other issuers now use similar structures.
- Discount to par
- How far a preferred share's market price sits below its $100 stated amount, shown as a percentage. A negative figure means the share trades at a premium to par.
E
- Effective yield
- The annual dividend as a percentage of the price actually paid for a preferred share. If a share trades below its $100 stated amount, the effective yield is higher than the stated dividend rate.
- Ex-dividend date
- The first trading day on which a share trades without its next declared dividend. Anyone acquiring the share on or after this date does not receive that payment. In the US it now usually equals the record date.
F
- Fixed-rate preferred
- Preferred stock that pays the same annual percentage of its stated amount for as long as it is outstanding. STRF, STRE, STRK, STRD and SATS are fixed-rate. Their prices move instead of their rates.
- Form 8-K
- A "current report" that US public companies file with the SEC to disclose material events between quarterly reports. Digital credit issuers use it for dividend declarations, rate changes, new certificates of designations and weekly capital updates.
- Fundamental change
- A defined event, such as certain takeovers or a delisting, that lets preferred holders require the issuer to repurchase their shares for cash, usually at the stated amount plus accumulated dividends.
L
- Liquidation preference
- The amount per share a preferred holder is entitled to receive, ahead of common shareholders, if the issuer is wound up. For most digital credit it starts at $100 and can float upwards with the market price.
M
- mNAV · issuer metric
- Strategy's own market-derived ratio: MSTR's share price divided by Net Bitcoin Per Share in US dollars, meaning bitcoin per fully diluted share after deducting debt and preferred net of USD assets. It is not a traditional NAV.
N
- Non-cumulative dividend
- A dividend that is lost for good if the board does not declare it. Nothing accrues and holders have no later claim to it. STRD is the only non-cumulative Strategy preferred.
P
- Par-targeting
- An issuer's stated aim to keep a variable-rate preferred trading close to its $100 stated amount, mainly by adjusting the monthly dividend rate. It is a policy intention, not a contractual promise.
- Pari passu
- Latin for "with equal step". Two securities rank pari passu when they share equally, in proportion to their claims, in dividends or liquidation proceeds, with neither ranking ahead of the other.
- Payment date
- The date on which a declared dividend is actually paid to holders who were on the register at the record date. For daily-paying preferreds there is one payment date per business day.
- Perpetual preferred stock
- Preferred shares with no maturity date. The issuer pays dividends but never has to repay the principal. Holders get their money back only by selling, through a redemption or repurchase, or in a liquidation.
- Prospectus supplement (424B5)
- A document filed with the SEC under Rule 424(b)(5) that sets out the terms, pricing and risks of a specific securities offering made under an existing shelf registration. Most digital credit launches start with one.
R
- Rate adjustment mechanism
- The rules in a variable-rate preferred's terms that govern how and when the issuer may change the dividend rate, including limits on how far and how fast it may be cut.
- Record date
- The date on which a holder must be on the issuer's register to receive a declared dividend. Shares sold after the record date still carry that dividend to the seller.
- Repurchase programme
- A board authorisation allowing an issuer to repurchase its own securities, up to a set amount, through open-market or negotiated purchases. Strategy has one for its preferred stock, with STRC as the stated priority.
- Return of capital distribution
- A distribution that, for US tax purposes, is treated as a repayment of the holder's investment, not as dividend income, because the issuer has no current or accumulated earnings and profits. It reduces the holder's cost basis.
S
- Seniority
- The order in which an issuer's securities are paid dividends and liquidation proceeds. Senior preferred is paid before junior preferred, which is paid before common shares. All preferred ranks behind debt.
- SOFR
- The Secured Overnight Financing Rate, a benchmark for the cost of borrowing cash overnight against US Treasury collateral, published daily by the New York Fed. STRC and SATA use SOFR-based floors for rate cuts.
- Stated amount (par)
- The fixed per-share amount, usually $100, on which a preferred stock's dividend rate is calculated. It is often called par, but it is separate from the legal par value of $0.001 shown on the share certificate.
- Stream (STRE) · issuer metric
- Stream is Strategy's name for STRE, its 10.00% Series A Perpetual Stream Preferred Stock: a euro-denominated, fixed-rate, cumulative preferred listed in Luxembourg, ranking third among Strategy's preferred series.
- Stretch (STRC) · issuer metric
- Stretch is Strategy's name for STRC, its Variable Rate Series A Perpetual Stretch Preferred Stock: a cumulative, variable-rate preferred managed to trade near $100, paying 12.00% a year as of October 2026.
- Stride (STRD) · issuer metric
- Stride is Strategy's name for STRD, its 10.00% Series A Perpetual Stride Preferred Stock: a fixed-rate, non-cumulative, quarterly-paying preferred that is the most junior of Strategy's preferred series.
- Strife (STRF) · issuer metric
- Strife is Strategy's name for STRF, its 10.00% Series A Perpetual Strife Preferred Stock: a fixed-rate, cumulative, quarterly-paying preferred that ranks most senior among Strategy's preferred series.
- Strike (STRK) · issuer metric
- Strike is Strategy's name for STRK, its 8.00% Series A Perpetual Strike Preferred Stock: a cumulative, quarterly-paying preferred that holders can convert into MSTR common stock at $1,000 per share.
T
- Tax redemption
- An issuer's right to redeem an entire preferred series if specified tax events occur, such as a change in tax law that affects how the dividends or the instrument are treated.
U
- USD Reserve · issuer metric
- Strategy's own term for a board-designated pool of US dollar cash and short-term investments set aside to pay preferred dividends and debt interest. Policy requires at least 12 months of expected payments.
V
- Variable-rate preferred
- Preferred stock whose dividend rate the issuer can reset, usually each month, within limits set in the terms. STRC and SATA are variable-rate. Their rates are announced before each period starts.
W
- W-8BEN
- The IRS form an individual who is not a US person gives to a broker or payer to certify foreign status and, where eligible, claim a reduced treaty rate of US withholding tax on US-source income such as dividends.
- Withholding tax
- Tax deducted at source from a payment before it reaches the recipient. US-source dividends paid to non-US holders face 30% US withholding by default, which a tax treaty can reduce.
Y
- Yield to call
- The annualised return from holding a preferred share at today's price until a possible issuer redemption at the call price, counting dividends received in the meantime. It is only meaningful where a call price and date can be assumed.