The investor anticipates that the stock price will fall, allowing him or her to buy back the stock at a lower price in the future.
"What the investor does is sell while the prices go low and then doesn't get back in until the prices are high again, so they lock in their loss and then they buy back at a high price, " he said.
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When investors short a stock, they borrow shares, hoping the price falls so they can buy the stock back later at a lower price, return the shares and make a profit.
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If stock rises instead, however, the investor could have to buy it back at a higher price than he or she sold it for, resulting in a loss.
Paul Marsh, of the London Business School, says studies suggest that, in the American market, the announcement of a buy-back boosts the share price by around 2%, compared with around half that in Britain.
With its shares selling for a quarter of their 1999 peak, it could also be an opportunity for the Ford family, which still has over 40% voting control, to buy back stock at a depressed price.
It's the practice of selling a borrowed stock expecting to buy it back later at a lower price.
They can buy the shares back at the lower price and return them to the original owner, pocketing the difference.
Short sellers borrow stocks and sell them hoping to buy them back later at a lower price and pocket the difference.
In regular short-selling, the trader borrows shares for a fee from his prime broker and sells them, hoping to buy them back later at a lower price and reap the profit on the difference.
In early September, Barrick unveiled a plan to close out fixed hedges and begin to buy back a portion of its floating-price hedges.
Reverse repurchase agreements involve the sale by the Fed of securities from its portfolio with an agreement to buy the securities back at a slightly higher price at a later date.
Traders could decide to buy back the options should premiums shift to an advantageous price at some point ahead of expiration.
The change has taken Denmark nearly two decades to implement, but the most critical step was the introduction of smart- or net-metering, which required utilities to buy back electricity from consumers at 85% of the price.
He said no, not now, and you can guess why even though at last report he had very favorable terms to buy a bundle of AIG shares back if he thought the price was right.
This claimant public customer alleged that the respondent brokerage firm asserted that after the customer sold positions in his account that he could buy back those sold positions within sixty days at the original sale price.
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Traders and investors in Europe welcomed the move by Greece Monday to buy back up to 10 billion Euros of its outstanding bonds at a price from 30 to 40 cents on the dollar.
In overnight news, the Euro currency and European stocks were given a boost when Greece announced it would buy back up to 10 billion Euros of its outstanding bonds at a price from 30 to 40 cents on the dollar.
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The Euro currency, European stocks and the raw commodity markets were given a mild boost Monday when Greece announced overnight it would buy back up to 10 billion Euros of its outstanding bonds at a price from 30 to 40 cents on the dollar.
That will show a huge surge in the stock price, because for example short sellers will have to buy back.
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Goldman has made an offer to buy back the warrants from holders for a 10% premium on their purchase price, plus a fixed payment to cover broker fees.
Whereas, at the height of the bull market, many investors bought on the back of a buy recommendation in the hope of quick rise in the price - only to be left disappointed when the quick buck didn't materialise.
So, on November 27th, Mr David-Weill said that Eurafrance would begin a buy-back of its shares and would look for other ways to increase their price towards their asset value or better.
Holders also allege that after it notified the exchange of the problem but before trading was frozen, Goldman continued to bid to buy back the warrants while ceasing sell offers that would have meant disclosing the real price based on the prospectus.
Ideally, by investing some of your regular contributions into asset classes that are doing poorly, investors continually buy shares at a lower price with the goal of eventually riding the asset class back to the top.
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If successful, he'll design an auction system so the government can buy some very complex assets at the right price high enough to infuse money back into banks, but not so high that it bilks taxpayers.
In October the company announced it would buy back 10 million shares of its own stock, in the hope of propping up the share price.
Companies buy back stock for a variety of reasons from earnings-per-share enhancement to lack of share price growth.
Buy back kiosks are popping up across the U.S. EcoATM examines your device and offers a price based on its condition.
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