Dividend, Share Price: Is there a connection?

[rozella]

Re: Dividend, Share Price. Is there a connection?

Sold SGP today @ 600.0. Bought on 13th December @ 589.0 with a margin of 70%.
Investment 176.7/share
Reported yesterday. Distribution 19.3/share Franking TBA. exdiv 23rd Dec
Gross profit 11.0/share = 6.22% return on investment. 2 day trade.
Will re-enter soon. Currently 593/595

My timing was off with selling some of my NAB holdings with the Danske Bank sale....but nothing to do with the dividend strategy......my bad luck.

rozella

 

[rozella]

Re: Dividend, Share Price. Is there a connection?

Re-entered SGP today @ 594.0 with a margin of 70%. Investment 178.2/share.

Sold another parcel today of WBC @ 1896.0 Bought 8th November @ 1896.0 with a margin of 75%. Investment 474.0/share. Dividend received yesterday 44.0/share fully franked 18.857/share.
Gross profit 62.857/share = 13.26% return on investment. 37 day trade.

rozella

 

[rozella]

Re: Dividend, Share Price. Is there a connection?

Sold a parcel of ANZ today @ 2033.0 (taking too long to rise) Bought @ 2028.0 with a margin of 75% on 8th November (exdiv day). Investment 507.0/share
Gross profit 5.0/share = 0.99% return on investment. 38 day trade.

Re-entered CPA today on the close @ 132.0 with a margin of 70%. Investment 39.6/share
Ex-distribution 23rd December. div 4.83/share zero franked.

rozella

 

[rozella]

Re: Dividend, Share Price. Is there a connection?

Sold last parcel today of WBC @ 1915.0. Bought @ 1908.0 on 2nd November with a margin of 75%. Investment 477.0/share. Div received 44.0/share fully franked 18.857/share.
Gross profit 69.857 = 14.64% return on investment. 45 day trade

Sold a parcel today of SGB @ 2484.0. Bought @ 2480.0 on 26th November with a margin of 75%. Investment 620.0/share. Div received today 62.0/share fully franked 26.57/share
Gross profit 92.57/share = 14.93% return on investment. 21 day trade

rozella

 

[rozella]

Re: Dividend, Share Price. Is there a connection?

Sold last parcel of SGB today @ 2485.0 Bought 26th November @ 2480.0 with a margin of 75% Investment 620.0/share. Div 62.0/share fully franked 26.57/share
Gross profit 93.57/share = 15.09% return on investment. 24 day trade.

Re-entered GAN on 15th Dec @ 165.0 with a margin of 70%. Investment 49.5/share.
Exdistribution 23rd Dec. 5.2/share zero franked.

rozella

 

[rozella]

Re: Dividend, Share Price. Is there a connection?

Sold last parcel today of ANZ @ 2049.0 Bought @ 2044.0 on 1st November with a margin of 75%. Investment 511.0/share. Div 54.0/share fully franked 23.14/share.
Gross profit 82.14/share = 16.07% return on investment. 50 day trade

Bought DUE today @ 253.0 with a margin of 65%. Investment 88.55/share.
Exdist 23rd December. Dist. 13.5/share zero franked.

rozella

 

[nto]

Re: Dividend, Share Price. Is there a connection?

Hi Rozella,

I have been following this thread since I joined, your strategy involves margin lending, is it possible to work without a margin loan? I know I wouldnt be able to trade as much. I can see if I lose first go then it will be hard to recover. But it is not really a gamble it is a calculated risk?

Any comments be great

Have a great Christmas
Thanks
Norm

 

[rozella]

Re: Dividend, Share Price. Is there a connection?

G'day Norm,

Marginlending is just a way of financing so that you are able to have more in the market.

To buy say 3000 ANZ, whether you buy on margin or not will still give you the same dollar profit or loss. Its only the percentage return on investment outlayed that is different.

It is a good idea to start the strategy with 100% of your own cash, then as you feel comfortable with it, start a margin loan account & gradually reduce your own cash invested. It is not much point borrowing money to invest if you are not sure of a strategy. It took me a while to be satisfied & to fine tune my rules, & then I was only prepared to borrow 80% of the credit available. But in the last few years I have become very disciplined with stoplosses & now operate in the buffer zone most of the time. i.e. 102% approx of available credit.

You don't see much evidence of stoplosses in my posts because we are in a great period for the strategy.

rozella

 

[DTM]

Re: Dividend, Share Price. Is there a connection?

Hi Rozella

I have enjoyed reading your posts. You have an interesting investment method. What are the risks involved? What do you look for when you make the dividend play? What happens to the price of the share after the last date to qualify for the dividend? Do different shares react different when the shares go ex dividend.

Interested to know.

 

[rozella]

Re: Dividend, Share Price. Is there a connection?

G'day DTM,

What are the risks involved?

If you decide that the stock meets your criteria, you go with it & a disciplined stoploss protects you if you were wrong.

What do you look for when you make the dividend play?

Increased profits, increased dividend, & good outlook statement for the future.

What happens to the price of the share after the last date to qualify for the dividend?

I usually expect for the stock to drop the dividend + franking credit on exdiv day & adjust my last trailing stoploss down by that amount. This is the only time I adjust the stoploss down.

Do different shares react different when the shares go ex dividend.

Yes, but life is not that easy.....I wish I knew which ones......what is a great recovery stock this period, may be a dog the next.

Most of the above is on my website, if you go to Trading Diary, you will see where the initial stoploss is followed a few lines down with the current trailing stoploss as at 17th December. The Margin Trading page will show you the trading position as at 17th December.

exdividendwatchlist

rozella

 

[DTM]

Re: Dividend, Share Price. Is there a connection?

Thanks Rozella

Greatly appreciated

 

[rozella]

Re: Dividend, Share Price. Is there a connection?

Bought DRT today @ 133.0 with a margin of 70%. Investment 39.9/share.
Exdist 23rd December. Dist. 5.2/share zero franked.

rozella

 

[rozella]

Re: Dividend, Share Price. Is there a connection?

Sold SGP on 24th December @ 589.0 Bought on 13th December @ 589.0 with a margin of 70% Investment 176.7/share. Exdist on 23rd Dec. Distributon of 19.3/share & franking TBA.
Gross profit 19.3/share = 10.92% return on investment. 11 day trade.

rozella

 

[RichKid]

Re: Dividend, Share Price. Is there a connection?

Hi Rozella,

Watching your thread with interest. Newbies like me are sure to learn.

I'm currently in GoldLink (GLI) and thought it may qualify for your type of strategy (I bought some after it went ex div for a short term trade), might see what I can do next time it approaches ex-div date and buy before ex date like your rather than afterwards (as I did this time).

This is not a tip but GLI may be your type of candidate as it pays regular fully franked divs and rises predicatably (touchwood!!!).

 

[rozella]

Re: Dividend, Share Price. Is there a connection?

G'day Rich Kid,

I always see GLI pop up near dividend period, but am more involved with others as the LVR for GLI is only 50%, I have just looked at the exercise buying GLI 2 weeks prior to exdiv as follows.

Buy GLI @ 116.0 on 19th November with a 50% margin. Investment 58.0/share. Exdiv 3rd December. Div 5.0/share fully franked 2.14/share.
It reached 122.0 on 2nd Dec, so trailing stoploss is 118.0 at close. Open on exdiv day, trailing stoploss is 118.0 - (div+fc) = 111.0/share. This is ok as exdiv day close is 114.0.

3rd Dec 114.0 trailing stoploss 111.0
6th Dec 115.0 trailing stoploss 111.0
7th Dec 115.0 trailing stoploss 111.0
8th Dec 114.0 trailing stoploss 111.0
9th Dec 119.0 trailing stoploss 115.0
10th Dec 118.0 trailing stoploss 115.0
13th Dec 112.0 stopped out

Sold GLI @ 112.0 on 13th December.
Gross profit 3.14/share = 5.41% return on investment
24 day trade

If we were still holding it was 107.0 on 24th December.

If the LVR was 65% or 70% then I would probably use it. Stoploss must be disciplined for this strategy to be a consistent winner.

All the best in the New Year for everyone & I hope we all have a prosporous one.

Cheers,

rozella

 

[idribble]

Re: Dividend, Share Price. Is there a connection?

thanks rozella for a brilliant and informative thread.

 

[rozella]

Re: Dividend, Share Price. Is there a connection?

Bought WDC today @ 1646.0 with a margin of 75%. Investment 411.5/share.
Profit announcement expected in February. Distribution ?

CBA next on the list.....maybe next week

rozella

 

[Tric]

Re: Dividend, Share Price. Is there a connection?

great thread rozella, thanks.

I also had a look at your website, all very interesting and profitable strategy esp in todays market.

 

[rozella]

Re: Dividend, Share Price. Is there a connection?

G'day Tric, glad you are interested.

Sold DRT today near the close @ 133.0 Bought 22nd December @ 133.0 with a margin of 70%.
Investment 39.9/share. Div 5.2/share zero franked.
Gross profit 5.2/share = 13.03% return on investment 9 day trade.

Happy New Year to all

Cheers,

rozella

 

[rozella]

Re: Dividend, Share Price. Is there a connection?

Not a great deal to buy that has declared a dividend, so I have temporarily dropped my yield margin & bought NFD today @ 631.0 with a 70% margin. Investment 189.3/share.
Dividend 10.0/share fully franked 4.29/share. Exdiv 11th January.
I think I will sell prior to exdiv day.....risky trading with takeover offers about, especially if the bidders pull out.

Bought JBM today prior to profit announcement date @ 444.0 with a 50% margin.
Investment 222.0/share.
Last years dividend this period was 20.0/share 50% franked 4.29/share, & the exdiv date was 23rd February.......see what happens on announcement date as to staying for the div.

Put a buy order in for CBA @ 3209.0

rozella