Dividend, Share Price: Is there a connection?
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Re: Dividend, Share Price. Is there a connection?
G'day Mouse,
Yes, no worries with MLE. I did not trade it as the margin LVR was only 50%, but this would be how it would go.....hindsight is a wonderful thing.
Using closing prices for consistancy, but if intraday prices were used, a better result could have been achieved
Buy on announcement closing price 19th December @ 237.0 (low 233.0)
margin 50%, so investment (outlay) 118.50/share
Dividend 7.0/share zero franked
20th Dec closing price 237.0
21st Dec closing price 237.0
22nd Dec exdiv day closing price 230.0
23rd Dec closing price 233.0
28th Dec closing price 236.0
29th Dec closing price 237.0 (high 238.0) Sell on close
Gross profit 7.0/share = 5.91% return on investment in 9 days
If you waited another day to 30th Dec, the closing price was 248.0/share
Gross profit 7.0 + 11.0 = 18.0/share = 15.19% return on investment in 10 days
G'day Mouse,
Yes, no worries with MLE. I did not trade it as the margin LVR was only 50%, but this would be how it would go.....hindsight is a wonderful thing.
Using closing prices for consistancy, but if intraday prices were used, a better result could have been achieved
Buy on announcement closing price 19th December @ 237.0 (low 233.0)
margin 50%, so investment (outlay) 118.50/share
Dividend 7.0/share zero franked
20th Dec closing price 237.0
21st Dec closing price 237.0
22nd Dec exdiv day closing price 230.0
23rd Dec closing price 233.0
28th Dec closing price 236.0
29th Dec closing price 237.0 (high 238.0) Sell on close
Gross profit 7.0/share = 5.91% return on investment in 9 days
If you waited another day to 30th Dec, the closing price was 248.0/share
Gross profit 7.0 + 11.0 = 18.0/share = 15.19% return on investment in 10 days
Re: Dividend, Share Price. Is there a connection?
Thanks for that Rozella.
I bought them a couple of weeks earlier at $2.20, when the news of the new theme park came out, and accidentally made an extra profit with the dividend. More luck than strategy though, they kept going up so I hung onto them.
cheers
Mouse
Thanks for that Rozella.
I bought them a couple of weeks earlier at $2.20, when the news of the new theme park came out, and accidentally made an extra profit with the dividend. More luck than strategy though, they kept going up so I hung onto them.
cheers
Mouse
Re: Dividend, Share Price. Is there a connection?
Good work, sometimes situations coincide. Last year in the LPT sector, there were a few mergers that coincided with the dividend strategy, which was the "cream" if you were lucky to pick the right ones.
Mouse said:
Good work, sometimes situations coincide. Last year in the LPT sector, there were a few mergers that coincided with the dividend strategy, which was the "cream" if you were lucky to pick the right ones.
Re: Dividend, Share Price. Is there a connection?
Sold NAB today @ 3363.0
Bought 18th November @ 3365.0 with a margin of 75%
Investment 841.25/share
Exdiv 21st November, dividend 83.0/share 80% franked 28.46/share
Gross profit 109.46/share = 13.01% return on investment. 70 days
Sold NAB today @ 3363.0
Bought 18th November @ 3365.0 with a margin of 75%
Investment 841.25/share
Exdiv 21st November, dividend 83.0/share 80% franked 28.46/share
Gross profit 109.46/share = 13.01% return on investment. 70 days
michael_selway
Coal & Phosphate, thats it!
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Re: Dividend, Share Price. Is there a connection?
Hi when was you last -ve ROI?
Thx
MS
rozella said:
Hi when was you last -ve ROI?
Thx
MS
Re: Dividend, Share Price. Is there a connection?
G'day michael_selway,
I have had less trades this FY than usual.
66 trades
48 wins
4 losses
14 open
Previous year for the same period
114 trades
89 wins
15 losses
10 open
Also more profitable last year, but it was exceptional for the 1st six months of 2004/2005 FY, this year sofar has had a few topsy turvey weeks.
G'day michael_selway,
I have had less trades this FY than usual.
66 trades
48 wins
4 losses
14 open
Previous year for the same period
114 trades
89 wins
15 losses
10 open
Also more profitable last year, but it was exceptional for the 1st six months of 2004/2005 FY, this year sofar has had a few topsy turvey weeks.
Re: Dividend, Share Price. Is there a connection?
Rozella,
I have no doubt this is an excellent way of generating income and I occassionaly take advantage of this form of trading.
Shouldn't your NAB example also include the cost of interest and the cost of buying/selling the shares. For tax purposes I know that the cost of buying /selling would normally go to the CGT calculation but this type of ROI example should include it, shouldn't it?
I would calculate that at 75% LVR the borrowed amount of 2523.75 per share would accrue 189.28 interest per share per 12 month period (at 7.5% per annum rate).
Given that you borrowed for two months, the interest on your borrowings of $25.24 per share should be 31.5 cents per share( if my maths is correct). This would come off your profit wouldn't it?
Additionally you would have at least $40 buy / sell cost that you would need to amortise over the amount of shares that you purchased/sold.
Don't get me wrong - this is definitely a worthwhile strategy, but I would have thought that these are necessary costs to include in the calculation and people wishing to adopt this strategy need to understand it, or ,if I have it wrong then I need to understand it.
rozella said:
Rozella,
I have no doubt this is an excellent way of generating income and I occassionaly take advantage of this form of trading.
Shouldn't your NAB example also include the cost of interest and the cost of buying/selling the shares. For tax purposes I know that the cost of buying /selling would normally go to the CGT calculation but this type of ROI example should include it, shouldn't it?
I would calculate that at 75% LVR the borrowed amount of 2523.75 per share would accrue 189.28 interest per share per 12 month period (at 7.5% per annum rate).
Given that you borrowed for two months, the interest on your borrowings of $25.24 per share should be 31.5 cents per share( if my maths is correct). This would come off your profit wouldn't it?
Additionally you would have at least $40 buy / sell cost that you would need to amortise over the amount of shares that you purchased/sold.
Don't get me wrong - this is definitely a worthwhile strategy, but I would have thought that these are necessary costs to include in the calculation and people wishing to adopt this strategy need to understand it, or ,if I have it wrong then I need to understand it.
Re: Dividend, Share Price. Is there a connection?
G'day 123enen,
Buy price = 3365.0/share
LVR 75% = 2523.75/share
Interest rate = 7.9%
Days held = 70
Total interest = 38.22/share
Brokerage x 2 = 3.3/share (based on $33/trade)
Dividend = 83.0/share
Franking credit = 28.46/share
Profit after interest & brokerge = 67.94/share
ROI after interest & brokerage = 8.08% in 70 days
This trade being 70 days is far too long, but it is the 1st time during this trade that it returned anywhere near the buy price. By holding 46/47 days, I can be eligible for the franking credit which is enough to wipe out the interest charge. However, because I don't always stay for the dividend, my average holding period atm for this FY is 31.22 days.
And as I am classed as a trader, I am not involved with any CGT, & interest & brokerage are expenses, as being part of all the other trading expenses.
Cheers
G'day 123enen,
That is why I am particular to say Gross profit. You will find this has been mentioned a few times in this thread, however it is easy enough to calculate for those who wish to.
Buy price = 3365.0/share
LVR 75% = 2523.75/share
Interest rate = 7.9%
Days held = 70
Total interest = 38.22/share
Brokerage x 2 = 3.3/share (based on $33/trade)
Dividend = 83.0/share
Franking credit = 28.46/share
Profit after interest & brokerge = 67.94/share
ROI after interest & brokerage = 8.08% in 70 days
This trade being 70 days is far too long, but it is the 1st time during this trade that it returned anywhere near the buy price. By holding 46/47 days, I can be eligible for the franking credit which is enough to wipe out the interest charge. However, because I don't always stay for the dividend, my average holding period atm for this FY is 31.22 days.
And as I am classed as a trader, I am not involved with any CGT, & interest & brokerage are expenses, as being part of all the other trading expenses.
Cheers
Re: Dividend, Share Price. Is there a connection?
Hello Rozella,
Have you ever traded BSO ( Bass strait oil trust) for dividend. They are a roller coaster ride with a yield of 17-20% inc. capital returns, unfranked. Super high increase until ex date then cliff face drops. That would be a scary one.
Comsec LVR =50%.
I am not game. Would like your opinion.
Hello Rozella,
Have you ever traded BSO ( Bass strait oil trust) for dividend. They are a roller coaster ride with a yield of 17-20% inc. capital returns, unfranked. Super high increase until ex date then cliff face drops. That would be a scary one.
Comsec LVR =50%.
I am not game. Would like your opinion.
Re: Dividend, Share Price. Is there a connection?
G'day 123enen,
The last time I traded BSO was December 2002, for a win, exiting prior exdiv. But I have lost on it before that. The problem is that the trust is being wound down. I sold it for 364.0 in 2002, & it is now 227.0 3 years later.
If you get clever you may be able to pick an entry point cum dividend & exit prior exdiv date......but there are plenty more to pick from these days around the same time than to take chances.
A trader friend of mine had a nice win on it doing just that this December, however you need to watch it carefully.
Cheers,
G'day 123enen,
The last time I traded BSO was December 2002, for a win, exiting prior exdiv. But I have lost on it before that. The problem is that the trust is being wound down. I sold it for 364.0 in 2002, & it is now 227.0 3 years later.
If you get clever you may be able to pick an entry point cum dividend & exit prior exdiv date......but there are plenty more to pick from these days around the same time than to take chances.
A trader friend of mine had a nice win on it doing just that this December, however you need to watch it carefully.
Cheers,
Re: Dividend, Share Price. Is there a connection?
Sold GUD today in bits & pieces @ average 796.43/share
Bought 24th January @ 765.0 with a margin of 65%
Investment 267.75/share
Gross profit 31.43/share = 11.74% return on investment. 6 days
GUD announced today with an increased profit & increased dividend to 27.0/share fully franked.
I will try for a re-entry at a lower price if the situation permits....but it is starting to climb again.
Sold GUD today in bits & pieces @ average 796.43/share
Bought 24th January @ 765.0 with a margin of 65%
Investment 267.75/share
Gross profit 31.43/share = 11.74% return on investment. 6 days
GUD announced today with an increased profit & increased dividend to 27.0/share fully franked.
I will try for a re-entry at a lower price if the situation permits....but it is starting to climb again.
Re: Dividend, Share Price. Is there a connection?
Should have stayed in GUD so re-entered today @ 797.0 with a margin of 65%
Investment 278.95/share
exdiv 20th February, dividend 27.0/share fully franked 11.57/share
Bought ADB @ 1328.0 with a margin of 70%
Investment 398.4/share
Expected to report this Thursday 2nd February, with exdiv expected 7th March.
Last years dividend was 24.0/share fully franked.
Should have stayed in GUD so re-entered today @ 797.0 with a margin of 65%
Investment 278.95/share
exdiv 20th February, dividend 27.0/share fully franked 11.57/share
Bought ADB @ 1328.0 with a margin of 70%
Investment 398.4/share
Expected to report this Thursday 2nd February, with exdiv expected 7th March.
Last years dividend was 24.0/share fully franked.
Re: Dividend, Share Price. Is there a connection?
Bought another parcel of ADB today after dividend announcement @ 1320.0 with a margin of 70%
Investment 396.0/share
Announcement today, exdiv 9th March, dividend 26.0/share fully franked 11.14/share
Bought another parcel of ADB today after dividend announcement @ 1320.0 with a margin of 70%
Investment 396.0/share
Announcement today, exdiv 9th March, dividend 26.0/share fully franked 11.14/share
Re: Dividend, Share Price. Is there a connection?
Sold SGP today on the open @ 661.0
Bought 20th December @ 660.0 with a margin of 70%
Investment 198.0/unit
Exdist 22nd December, distribution 20.5/unit, franking TBA
Gross profit 21.5/unit = 10.86% return on investment. 49 days
Sold SGP today on the open @ 661.0
Bought 20th December @ 660.0 with a margin of 70%
Investment 198.0/unit
Exdist 22nd December, distribution 20.5/unit, franking TBA
Gross profit 21.5/unit = 10.86% return on investment. 49 days
Re: Dividend, Share Price. Is there a connection?
Out of SGP too early, unfortunately missed the cream, but still achieved my aim.
Bought another parcel of CBA today @ 4360.0 with a margin of 75%
Investment 1090.0/share
Exdiv expected 20th February. Last years div was 85.0/share fully franked 36.43/share
Out of SGP too early, unfortunately missed the cream, but still achieved my aim.
Bought another parcel of CBA today @ 4360.0 with a margin of 75%
Investment 1090.0/share
Exdiv expected 20th February. Last years div was 85.0/share fully franked 36.43/share
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Re: Dividend, Share Price. Is there a connection?
rozella,
Why AFI?
it's yield seems a bit low.
Rod.
rozella,
Why AFI?
it's yield seems a bit low.
Rod.
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