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Open-Market Purchase

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Open-Market Purchase
The act of buying a security at or close to the market price because of an order the buyer has placed for the security. The term especially refers to a situation where investors with inside information buy a security in accordance with the rules set forth by the SEC. See also: Open-market transaction.

open-market purchase
The buying of stocks and bonds in the securities markets. For example, in order to satisfy the sinking fund requirement of a bond indenture, the issuer may call securities from investors or make open-market purchases. Likewise, a firm wishing to reduce the number of its shares outstanding may make a tender offer to the firm's stockholders or purchase shares in the open market.


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The firm said its plans for Metal Management may include privately negotiating transactions of Metal Management's securities, open-market purchases, proposing a business combination including a merger, a tender offer or waging a proxy battle.
Thus, if managers accumulate shares to reach a certain threshold set by the compensation committee, and if the ownership threshold is set higher for those with better investment opportunity sets, the probability of an open-market purchase would be positively related to M/B ratios, and the probability of an open-market sale would be negatively related.
The Company may purchase common stock from time to time through open-market purchases or in privately negotiated transactions, and may reserve the shares purchased for later re-issuance in connection with these benefit plans.
 
 
 
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