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Question on Strategy’s STRF: Right now the yield on stated amount is 10% on $100 - so 10 dollars per share. The stated amount doesn’t change. If through better future credit ratings and bitcoin being perceived as safer in the market, the price of STRF goes up (lets say to 200), then the yield-on-price becomes less (5%). At a certain point the price hits a ceiling where the yield isn’t enough to justify price.

So how does STRF remain an attractive fixed income product at those prices? People who buy now would benefit, but it becomes less attractive over time?

#bitcoin #mstr #strf #saylor

VarMur 6mo ago

The way I see it, yield and price always justify each other. STRF remains attractive at those prices because the drop in yield is justified by the increase in credit worthiness. Same with STRD.

What’s also interesting is the interest rate sensitivity of these instruments. What should they be?

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