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Beginners - Introduce yourselves!

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Hi Im a newbie and very confused, but also really excited about learning how to trade in shares. As my circumstances has recently changed, I am now a stay at homer and need to get some $$$ back into my account. I have been reading quite a lot of things about share trading, problem is I think I have been reading too much!! I am going to go back to basics and start at the beginning.

Mx
 
Welcome Harvey.
Make full use of the search function, there will likely be an answer in there to every question you may have, if not just ask.
 
Hi,

I'm Xav I'm just learning and watching trading vids at the moment.

I had the thought of investment trading 6 years ago but put it off due to moving overseas to work.

Happy to be patient and learn to risk manage and think logically and write/document trading strategies & methods
 
Hi everyone,

Starting in my investing journey, and ready to learn lots. I started with the ASX beginners courses, and already on lesson 3 there is something on franked dividends that I need explaining. That is why I'm so happy that I have found this forum! I'll put it on another thread. Look forward to reading and learning.

Cheers
Miguel
 
Welcome XavierRI and migigl! I'm glad you found us. If you have any questions about how things work here, please don't hesitate to ask.

Be sure to explore the search function fully, as it will help you find the many thousands of threads buried in the various forums here at ASF.

Enjoy!
 
Hi Miguel, and welcome
Just a quick reply on franking credits.

Companies that make profits (not all of them do ) have the choice to re-invest the money into new projects or simply to expand, or they can pay a certain percentage to their shareholders as a dividend. In either case though, they have to pay tax first. Currently, the company tax rate stands at 30%.
For a shareholder, dividends are like wages and therefore subject to personal income tax.
However, if a dividend is paid out of "after-tax earnings", the Taxman has already taken 30% in tax; slugging the shareholder the full marginal tax rate, which could be as high as 48%, would be considered too greedy, even by Tax Office standards. Therefore, those 30% that have already been paid on shareholders' behalf are credited back to them.
The Maths is rather simple:
Assuming you, the shareholder who received the dividend, got paid $7,000. The pre-tax amount, that is the money which your company must have earned and paid 30% tax on, is $10,000 (30% = $3,000 has been paid on your behalf to the ATO.)
So, your share of the earnings is $10,000. If your marginal tax rate is 48%, you only need to pay the additional 18% or $1,800 on those 10 Grand. If you're in a lower tax bracket, the 30% pre-paid tax may exceed your personal rate and you may have been overtaxed.
Both cases are covered by the "Franking Credit", which is fancy speak for saying "those 30% paid on your behalf by the company are credited against your tax obligation." For it to work correctly, all that has to be done is to add the "grossed-up" dividend to your income.
 
Hi all
Only been trading for a few weeks now and jumped straight into it without any real research

Bought into AVZ at way too high a price at 0.170. It dropped pretty quickly for a couple of weeks and I kept buying more at lower prices to try and average down. Ended up with 18k at 0.116. Finally into profit now and it's at 0.135 but not sure if I should sell or hold on longer. Any tips would be great, cheers
 
We cannot give you specific advise but you need to ask yourself why you bought into the company in the first place and whether those points are still valid....This is only a speculative company so it could keep going up or crash back down......Depends on how much you are willing to risk. I always try to remove my original stake from any investment I make as soon as possible and let the rest run which depends on what I see on a chart based on technical analysis....

Latest comment from Lincoln stock doctor AVZ exhibits unacceptable levels of financial risk due to a below benchmark Financial Health score. Investors need to be aware such companies pose risks and warrant a speculative investment only. Any prospective investment should be managed with tight stop losses implemented.
 
I had a similar run with this stock when it was 2.5cents. It fell to 2c after some legal challenge so I topped up and later sold the "excess" parcels at 2.5 and sold the rest at 3c.

The rest is history and bitchery
 
Hi pixel, thanks for your explanation. That part is now clear. I also read other threads, as Joe Blow suggested. However, this is the paragraph that I still don't quite get, the "imputation credits" bit:
Franked dividends carry imputation credits, which entitle shareholders to a tax offset or a reduction in the amount of tax to be paid. If your marginal rate of tax is lower than the company tax rate, the excess franking rebate can be used to reduce the taxpayable on other sources of income.
Following on from your example, imagine that my marginal tax rate is 16% (which unfortunately isn't) and from my work income I have to pay $3400 in tax. Then I receive the franked dividends as you explained them. Does that mean that the ato would consider that I have already paid 14% of those $10000, so $1400?, and I would only have to pay $2000 more?

Thanks in advance.
Miguel
 
No.
Let's say that without the dividend you had taxable income of $40,000, for which you had to pay $3,400 (I'm too lazy to look up the exact tax rate.)
The taxman will then add the grossed-up dividend to your $40,000 taxable income, which lifts your taxable income to $50,000. At the assumed marginal rate of 16%, it would mean your new tax would be those initial $3,400 plus $1,600, which is 16% of the ten Grand dividend. So, your new tax would be $5,000, of which you have already paid $3,000 when you received only $7,000, the other $3,000 having been paid by the company to the ATO.
Those $3,000 are credited to you as pre-paid tax, and given the fancy title "franking" or "mputation credit".
As a result, you will only need to pay $2,000 tax instead of $3,400, your tax burden if you had NOT received a dividend.
 
Hello All,

Just introducing myself to this wonderful forum. Have been browsing for a while and have learnt so much from the information within.

I have been doing a bit of share trading for 15 years or so, only on a few stocks just for fun.

Recently I have been teaching myself on how to trade options and I have been enjoying it very much.

I am hoping to learn more on this field and hopefully I can connect with other traders in this forum.

Thanks

journey.
 

Welcome to ASF Journey. It's great that you found us.

If you have any questions about how things work here, please don't be afraid to ask.

You'll find the forum search to be a useful tool for tracking down old discussions on a wide range of topics, so I recommend you spend some time exploring its many options.

Otherwise, please enjoy the forums!
 
Hi everyone, new investor here just joined to get some info and advice from all the investors\traders here. hope to learn a lot.
thanks
 
Hey all, newbie here signing in for the first time. Been stalking this forum for a little while now so figured i should sign up and say hi. Im still in the research phase of my trading adventure and will be looking to dominate in the asx game when it starts up again next year. My focus as of now is from a day trading perspective and learning more about momentum trading and fundamentals. Look forward to learning from you guys.
 
Hi all, just joined in today, recently got sick of full service brokers, took control of my SMSF and transferred everything into Commsec. Considering stock screening platform and avoid the traps, where do i start?
 
Natlan said:
Hi all, just joined in today, recently got sick of full service brokers, took control of my SMSF and transferred everything into Commsec. Considering stock screening platform and avoid the traps, where do i start?
Click to expand...
Welcome to ASF Natlan! A good place to start might be the Where to start? thread. Other than that, just start doing some searches on topics that interest you. There's almost 24,000 threads here at ASF so there's plenty of content to explore.

If you have any other questions, please don't hesitate to ask.
 
Hello. I'm just started out investing and wanting to learn technical analysis. Very little experience in shares. I have some ETFs and that's it. Really want to build up my knowledge and start paper trading before having a proper go in the market. This forum seems like a great resource.
 
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