Comment by overrun11
11 hours ago
Buybacks in theory do not cause share price to rise like your example though. Investors already price in that cash will be either reinvested at a high rate or returned to shareholders. You are reducing share count of a company that now has less cash which nets out in share price.
Demand tends to push price up. Investors don't really know who's buying until later.
But yes, of course it's a toy example. I should probably have made the buybacks drive the price from $1.10 to $1.20 or something, with a much smaller reward for the founder & CEO. I got bored and kept it simple. (Or I got greedy for that $1 profit, maybe.)
All the working parts of the example are on display. You can make other examples that seem better to you.
Well there you go again, lying and making things up. The trades are executed in compliance with Rule 10b-18. If you want anyone to take you seriously then at least come up with a realistic example.