Wednesday, April 24, 2019
bucking the system so to speak
The company may do this to protect itself from a buyout or to use the stock as compensation for the purchase of a new asset. When new stock is issued, the company benefits from the sale and the cash flow from the sale of new stock can be used to invest in the company's operations. When stock is bought or sold between investors, the company does not directly benefit from the sale or purchase because money changes hands only between the two investors..
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