The process of buying back (or selling back) shares of preferred stock or mutual fund shares by (to) the issuer at a specific price. An issuer can redeem shares either by issuing new shares or out of profits available for dividend. Redemption may also be partly out of profits and partly by issuing new shares. A shareholder may sell stock back to the issuing company, in a way similar to the sale of stock to an unrelated third party.
March 13, 2024
