While that's true. Usually after a stock splits it goes up or down sometimes a lot.
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Investment Advice for Squilly
- Thread starter ucfgrad93
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While that's true. Usually after a stock splits it goes up or down sometimes a lot.
I'd assume dividends will decrease after the split?
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snberk mentioned inflation to me via PM. Completely forgot about that, granted it can't be that high...
He's trying to say, think your response through.
Its nice you are posting threads to gain knowledge but some of your questions can be answered by just searching.
No, Apple will have to pay 7X the dividend they announced.
WOW !! I'm buying some stock ASAP .
Cool ...Thank's for the tip man !!
OK thanks this clears things up
Never...
...and if you believe that....
Me neither.
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OK thanks this clears things up
Never...
...and if you believe that....
On second thought....
Sorry but I find it fairly obvious why you are mocked here.
You don't seem to do any research and expect us to be your Google? Yes there are situations where it's easier to ask someone because they may have gone through that stage or can provide advice, but I think some of your questions can be answered by going to the appropriate websites or searching up on it more.
If you are going to be investing, then inflation is absolutely something you need to pay attention to. Figure out where to look up the current rate. Also where the forecasted rate is. Your government (and mine) have policies about what they would like to see as well. Two other numbers you need to know... What is your tax bracket? And I don't mean the gross rate - but your effective rate after deductions and what not. You also need to keep in mind what your Capital Gains rules are like down there. And finally - how much can you make in a simple term deposit or bond? And finally... what kind of commission are you paying to buy/sell the stock.
It goes like this... You invest $1000 into a stock and pay a small commission. Did you think brokers did this for free? The stock gains 10% over the course of the year. Whoo Hoo you say to yourself!! And you decide to sell it - pocketing the $100 'gains'.
Now... deduct the tax you pay on that income. Deduct the commission you pay the broker. Do you folks pay capital gains on this down there? I don't know, but need to know this. Then.... look at the rate of inflation. Lets say it's 1.5%. What this means is .... if you had bought goods a year ago worth $1000 (like a spoiler and toys for your car) then you would need $1015 today to buy the same goods.
Or in in other words... subtract 1.5% from the 10% investment gain, and subtract all the other costs incurred including capital gains tax (if applicable) but not the income tax to get your true investment return. Now compare that to what you would have received had you simply found a term deposit. Keep in mind that a term deposit is safe and risk free, while a stock can just as easily go down as up. There is a reason why true investors have many stocks in their portfolio. By the way... Your 3 current holdings are a good first step to a diversified portfolio. Good work.
I'm going to get slammed for this... but I wouldn't be investing in the stock market ... I'd be borrowing money and buying a piece of property. Borrowed money is very cheap now-a-days. And you Americans, I understand, can write off the interest paid on mortgages against their taxes. And we all know there is some cheap real-estate down there now. Wish there was some up here in my neck of the woods. However, that is an even more complicated venture than stock investing... so perhaps one thing at a time.
No, Apple will have to pay 7X the dividend they announced.
Actually, wouldn't it be that the dividend per share would be 1/7 what it used to be? Sure, you'd get 7 dividends per share but it comes out to the same.
Thanks for all that. I don't pay capital gains from what I researched based on my income. My income is something like $18000/year but household is something like $160,000/year if that makes a difference (excluding my brothers "venture"). TD Ameritrade charges $10 per transaction. So in other words, I turned $2000 into approx. $2400-2450?
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That's what I was thinking but maybe the rate changes.
I have no idea but the IRS will know.
Again no idea. You need professional advice.
Keeping in mind that if your brother is filing an accurate tax return, and if he has listed you as an 'expense' or a 'deduction' of some sort then that impacts your tax obligations. If you have become a partner or a director to his company that also has tax implications. You will need professional advice in that case.
I have no idea I'm happy to share theories.. but you've gotta do the work to see how it applies to you.
Ok, sorry about my absence for such a long time. I was slammed yesterday and wasn't able to get here.
So, earlier, Squilly said he had about $2400 in 3 different stocks and $120 in cash in his tdameritrade account. He also said that he was looking to invest $10,000 into Apple stock in the near future. He wants to take advantage of the upcoming dividend and stock split.
Currently, Apple is trading at $592/share so if you invest $10,000 it would get you 16 shares of Apple with about $530 left over.
Now, lets ignore the upcoming split for the time being and say that it isn't happening and lets say you invested all of that into Apple stock. Congratulations, you now own 16 shares of Apple. Now how are you going to make money on that stock?
One way is to hold it and wait for the stock price to go up. If the price of the stock goes up 10%, then you would see a $960 gain. (I'm rounding the stock price up to $600 to make the math easier) But since that money is tied up in the stock and not liquid you don't have a way of reinvesting that gain into more stock. You could sell your 16 shares and then rebuy 17 shares but then you have to pay commissions and possibly capital gains.
Another way to make money on the Apple stock is to collect any dividends that Apple pays out. Next week Apple will pay a dividend of $3.29/share. If you had the 16 shares you would receive a total $52.64. Now you could reinvest this money and get a partial share of Apple stock and continue doing this and build up your shares. But it is a slow process and takes awhile since you have so few shares.
What are your thoughts about this Squilly?
So, earlier, Squilly said he had about $2400 in 3 different stocks and $120 in cash in his tdameritrade account. He also said that he was looking to invest $10,000 into Apple stock in the near future. He wants to take advantage of the upcoming dividend and stock split.
Currently, Apple is trading at $592/share so if you invest $10,000 it would get you 16 shares of Apple with about $530 left over.
Now, lets ignore the upcoming split for the time being and say that it isn't happening and lets say you invested all of that into Apple stock. Congratulations, you now own 16 shares of Apple. Now how are you going to make money on that stock?
One way is to hold it and wait for the stock price to go up. If the price of the stock goes up 10%, then you would see a $960 gain. (I'm rounding the stock price up to $600 to make the math easier) But since that money is tied up in the stock and not liquid you don't have a way of reinvesting that gain into more stock. You could sell your 16 shares and then rebuy 17 shares but then you have to pay commissions and possibly capital gains.
Another way to make money on the Apple stock is to collect any dividends that Apple pays out. Next week Apple will pay a dividend of $3.29/share. If you had the 16 shares you would receive a total $52.64. Now you could reinvest this money and get a partial share of Apple stock and continue doing this and build up your shares. But it is a slow process and takes awhile since you have so few shares.
What are your thoughts about this Squilly?
All that is correct. I may pull out of DDD since it's been slammed since the beginning of the year and put that towards Apple stock. Since when can you buy a partial share? Been considering QQQ since it's many companies I like in one ETF. Back in '98 wasn't Apple around $20? Same in '05 on their last split?
Ok, so lets say that you sell out of what you currently own and invest that and all of the $10,000 into Apple stock. At a price of $592 you could purchase 21 shares.
If you purchase 21 shares before the split, then after the split you would have 147 shares. The share price would no longer be $592, it would be about $84.60. Now realize the dividend will be cut by a factor of 7. So the current quarterly dividend would be $.47 instead of $3.29.
Even after the split, you have the same two ways of making money on this stock. Wait for the price to rise or collect dividends and reinvest them.
Would you be interested in hearing about a third way to make money on that Apple stock?
I am interested in hearing what else you have to say...I don't have the money to invest right now, but I find it interesting.
My personal thought is that some people may want to invest in Apple, but can't afford the current price. After the split would it drive in a lot of new investors helping push the price back up some?