Virtus InfraCap (NYSE: PFFA), a U.S.-Based Preferred Stock ETF issuer and asset manager, has significantly increased its stake in Strategy Inc.’s variable-rate perpetual preferred stock STRC, signaling growing institutional appetite for high-yield instruments tied to corporate Bitcoin treasuries.
The move comes as PFFA, a flagship income-focused ETF with approximately $2.37 billion in assets under management as of late May 2026, continues to attract investors seeking elevated monthly distributions in a yield-hungry market.
The updated data on the company’s official website now shows that the ETF holds 402,880 shares of STRC, representing a position valued at nearly $40 million.
This addition underscores a strategic tilt toward Bitcoin-adjacent securities that offer attractive yields without direct cryptocurrency volatility exposure.
PFFA’s Active Strategy and STRC Appeal
PFFA, sub-advised by Infrastructure Capital Advisors (InfraCap) and managed under the Virtus umbrella, employs an active approach to preferred securities. The fund invests at least 80% of its assets in U.S.-listed preferred stocks, utilizing modest leverage (typically 20-30%) and options overlays to enhance income and returns. It currently delivers a distribution rate around 9.5–9.75%, paid monthly, making it popular among income-oriented investors such as retirees.
STRC stands out in this portfolio. Issued by Strategy Inc. (formerly known for its MicroStrategy roots and now a leading Bitcoin treasury company), the perpetual preferred stock pays a variable rate—currently 11.50% annually on a $100 stated amount—distributed monthly in cash. The rate resets monthly to encourage trading near par value ($99.30 recently), reducing price volatility while providing an effective yield of about 11.58%.
Proceeds from STRC issuances primarily fund additional Bitcoin acquisitions. Strategy holds hundreds of thousands of BTC, creating a flywheel effect: capital raised supports BTC purchases, which bolster the company’s balance sheet and support preferred dividend payments.
Unlike direct Bitcoin exposure, STRC offers a senior claim in the capital structure (preferred over common equity) and return-of-capital tax treatment in many cases, appealing to conservative income seekers.
Institutional Validation of Bitcoin-Linked Income Products
This increased allocation reflects broader trends. As traditional fixed-income yields fluctuate with Federal Reserve policy, vehicles like STRC provide a compelling alternative—high current income backed by one of the strongest corporate treasuries in the digital asset space.
PFFA’s managers appear to view STRC as a diversified way to capture Bitcoin ecosystem upside while maintaining the fund’s core focus on preferred stock stability.
PFFA’s overall portfolio remains well-diversified across financials, utilities, and other sectors, with top holdings including securities from Oracle, Flagstar Bank, and Energy Transfer. The fund’s use of leverage amplifies income potential but also introduces added volatility and interest-rate sensitivity.
The STRC position, while meaningful, fits within its active mandate that allows tactical overweighting of undervalued or high-conviction names. Strategy’s preferred offerings have drawn both retail and institutional interest due to liquidity, monthly payouts, and perceived backing by substantial BTC holdings (not direct collateral, but supportive of the company’s financial strength).
Virtus InfraCap’s latest filing demonstrates confidence in this hybrid play. As more income funds explore Bitcoin proxies, products like PFFA could serve as gateways for traditional portfolios seeking yield enhancement without outright crypto allocation.
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