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What is treasury stock?
Treasury stocks refer to shares which once belonged to the class of outstanding shares and floats of a company but were purchased again and decommissioned by it. The company can indefinitely hold on to these stocks or reissue them to the public or cancel them even.
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Decoding its importance
Treasury stock is mainly issued by companies in order to prevent hostile takeovers. These can be used to create additional cash whenever the company requires it. These are also created by companies in order to produce additional cash whenever required. These are also created by companies when shares are issued initially.
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