<h2>Treasury Stock (Treasury Shares)</h2>
<p>Treasury stock, also known as treasury shares, refers to a company's own stock that has been repurchased by the company from its shareholders. These shares are not retired, but are held in the company's treasury, reducing the number of outstanding shares in the market.</p>

<h2>How It Works</h2>
<p>Companies can buy back their shares through various methods:</p>
<ul>
  <li><strong>Open Market Operations</strong>: The company purchases its shares directly from the public on the open market.</li>
  <li><strong>Direct Purchase</strong>: The company buys shares directly from a shareholder, often at a premium to the current market price.</li>
  <li><strong>Tender Offer</strong>: The company offers to buy back a certain number of shares at a specified price within a given time frame.</li>
</ul>
<p>Once repurchased, the shares are held as treasury stock. The company can later reissue these shares, use them as employee compensation, or retire them permanently.</p>

<h2>Why It Matters for Traders</h2>
<p>Treasury stock can impact traders in several ways:</p>
<ul>
  <li><strong>Reduced Supply</strong>: When a company buys back its shares, it reduces the number of outstanding shares, potentially increasing the value of the remaining shares due to supply and demand dynamics.</li>
  <li><strong>Signals Company Health</strong>: A company's decision to repurchase its shares can signal that it believes its stock is undervalued or that it has excess cash, indicating strong financial health.</li>
  <li><strong>Impact on Earnings per Share (EPS)</strong>: By reducing the number of outstanding shares, treasury stock can increase EPS, making the company's earnings look more impressive.</li>
</ul>

<h2>Example</h2>
<p>Let's say Company XYZ has 100,000 outstanding shares and earnings of $1 million. With 100,000 shares outstanding, EPS is $10. If Company XYZ buys back 20,000 shares, the new number of outstanding shares becomes 80,000. Assuming earnings remain the same, the new EPS would be $12.50, making the company's earnings per share appear 25% higher.</p>

<h2>Key Takeaways</h2>
<ul>
  <li>Treasury stock is a company's own stock that has been repurchased.</li>
  <li>Companies can buy back shares through open market operations, direct purchase, or tender offers.</li>
  <li>Treasury stock can impact traders by reducing supply, signaling company health, and affecting EPS.</li>
  <li>MetaTrader 5 platforms often display a company's treasury stock information in their fundamental analysis tools.</li>
</ul>