Almost everyone has wondered, or will wonder, about this question as they progress through their careers and, especially, as they approach retirement. After working most of their lives, this is understandably a million (or multi-million) dollar question that weighs on people’s minds as they prepare to spend more of their time finally doing exactly what they want.
Institutional Investors. These are the big wigs as far as investors go. They invest money for themselves, for other institutions (e.g. endowments, pension funds, etc.), and typically have billions of dollars at their disposal. This enables them to buy a majority stake in any S&P 500 company, and if they feel like having a chat with the CEO, or commanding a seat on the Board, both are just a quick phone call away.
How are individual investors supposed compete with these guys? Continue reading “Small but Mighty: How Individual Investors Can Compete With Large Institutions”
Publicly-traded companies buying their own shares (share “buybacks” or “repurchases”) increase earnings per share by reducing the total number of shares outstanding (identical earnings spread over fewer shares). It’s commonly positioned as “returning value to shareholders,” because investors who maintain their shares end up owning a larger percentage of total company shares; in turn owning a larger percentage of future earnings. As of February 10th, S&P 500 companies have announced plans for $99 billion dollars of share buybacks in 2016. The largest start to the year ever. Get ready to receive some serious value!
Not so fast – Continue reading “Share buybacks. Good, Bad, or Ugly?”
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