The kids are back in school, the leaves are changing colors, and pumpkin spice lattes – the age-old harbingers of harvest season – are everywhere. At Parsec, we are preparing for the harvest…of tax losses.
Probably since before you made your first dollar, you were told about the importance of investing in the stock market – about the wonders of compounding returns over time that can transform a lifetime of savings into a car, a house, and a comfortable retirement.
When you see trading activity in your account, it generally falls into three main types of investment trades: raising or investing cash, rebalancing, and block trading.
As the name implies, stock buybacks (also known as share repurchase programs) happen when companies buy back their own shares. A firm uses its cash position to repurchase company stock either in the open market or directly from select shareholders. These programs reduce the number of shares outstanding for the company in question and thus increase the ownership stakes of its remaining shareholders. The end result is more profits or earnings per share (EPS) per shareholder.
