Finance
Perpetual Preferred
Fixed-income instrument with no maturity that pays a fixed dividend, ranking ahead of common shareholders.
Definition
A perpetual preferred (perpetual preferred stock) is a hybrid financial instrument that shares characteristics of both debt and equity. It pays a predetermined fixed dividend (like Strategy's STRK at 8% or STRF at 10%), ranks ahead of common shareholders for dividends and in a liquidation, but has no maturity date ('perpetual'). Some are convertible into common shares. For investors in Bitcoin treasury companies, preferreds offer fixed income with indirect exposure to the BTC balance sheet.
In Context
E.G.
STRK (8%), STRF (10%), STRC (11.5%) and STRD (10%) are Strategy's preferreds listed on Nasdaq.
Related Terms
Read this term in Spanish: versión en español →