What is a stk redemption?

Question

account

Answer 1

I don't think the term should be used in a stock buyback. Redemption is the repayment of the original capital. It would normally apply to a dated bond. The capital is paid back on the final day (redemption date) of the bond'd life. So a £100 nominal bond, even though it's market price can be currently higher or lower will be redeemed at £100 for £100 stock (at par). You can calculate the flat yield or running yield of a bond from the coupon and curent price or calculate the redemption yield, which takes account of the loss or gain at redemption.

Redemption also applies to dated loan stocks, convertibles, preferred stock; in fact anything that has a maturity date.

Answer 2

it depends upon the context in which the phrase is used.   a stock redemption is when a company buys back its shares on the open market.  this is generally done to boost the stock price, and/or if management feels their stock is undervalued.

the account might be an accounting term for the account to which the redemption is accounted for in the journal entry.

or it might be an actual funded account used to fund the purchase of shares.