Ever heard of a company buying its own stock on the stock market? 🤔

That's called a share buyback 💰

Here's how it works: Let's say Apple has 100 shares on the stock market 🍎

If Apple buys back 10 of its own shares, there will now only be 90 shares left on the market 📉

By reducing the number of shares available, each remaining share now represents a bigger piece of the Apple pie 🥧

Companies typically buy back shares using excess cash they have on their balance sheet 💵

So most of the share buybacks you’ll see will be from large, mature companies with lots of cash.

By reducing the number of shares outstanding, buybacks are one way companies can return money to shareholders, without paying out dividends 👍

Share buybacks have become increasingly popular in recent years.

In 2021 alone, S&P 500 companies bought back a record $882 billion worth of stock! 🤯