How do stock buybacks work?

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I own some stock in Apple. Yesterday they announced they will be doing a stock buyback. Will I be compelled to sell the stock back to them? Will I receive some kind of offer from Apple? Will nothing happen?

I’ve searched for this and can only find articles about why companies do stock buybacks, not from the perspective of the shareholder

In: Economics

12 Answers

Anonymous 0 Comments

It’s a way of returning cash to shareholders (like a dividend), but instead of sending you cash, they use that cash to repurchase shares on the open market. The remaining shares now each represent a larger portion of the company. 

No, you are not compelled to sell your shares.  

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