Dividend, Share Price: Is there a connection?

[RodC]

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

Hi Rozella,

Are you still holding the banks (WBC,WGB,ANZ), they must have come close to being stopped out?

thanks,

Rod.

 

[rozella]

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

G'day twojacks28,

i am guessing rozella that you are a daytrader lol

No, I have an average holding time of 35.42 days for this year as at today.

generally when the company pays out a dividend the next day the share price will go down by dividend amount

I allow for a stock to drop the dividend + franking credit


G'day RodC,

Are you still holding the banks (WBC,WGB,ANZ), they must have come close to being stopped out?

Yes, I still have all the banks, but should not be holding any atm. ANZ had a good run yesterday, but half has been eroded today.

Cheers,

 

[RodC]

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

G'day RodC,


Yes, I still have all the banks, but should not be holding any atm. ANZ had a good run yesterday, but half has been eroded today.

Cheers,

thanks Rozella,

I was just wondering, as I've been stopped out of all of them.

Rod.

 

[rozella]

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

Yes, they have gone through my stoploss.....it can be expensive when the trigger is not pulled.

Bought SGP today @ 670.0 with a margin of 70%
Investment 201.0/unit
exdist expected 23rd June, last years distribution was 19.6/unit franked to 20.92% 1.76/unit

 

[rozella]

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

Sold LNN today @ 790.0
Bought 24th May @ 814.0 with a margin of 70%
Investment 244.20/share
Exdiv 29th May, dividend 19.0/share fully franked 8.14/share,
special dividend 30.0/share fully franked 12.86/share
Gross profit 25.0/share = 10.23% return on investment, fc excl. 9 days

 

[rozella]

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

Bought AWB today @ 452.0 with a margin of 70%
Investment 135.60/share
Exdiv 9th June, dividend 16.0/share fully franked 6.86/share.

 

[rozella]

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

I decided to take some profit from SGP today....I let it slip through my fingers a couple of times in the last day or two.

Sold SGP today @ 703.0
Bought 25th May @ 670.0 with a margin of 70%
Investment 201.0/unit
exdist expected 23rd June, last years distribution was 19.6/unit franked to 20.92% 1.76/unit
Gross profit 33.0/share = 16.41% return on investment. 13 days

 

[rozella]

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

What a crook day !!!

Sold CSR today @ 346.0
Bought 17th May @ 394.0 with a margin of 70%
Investment 118.20/share
Exdiv 6th June, dividend 9.0/share, fully franked 3.857/share
Gross loss 39.0/share = 33.0% loss on investment, fc excl. 22 days

Bought CFX today @ 190.5
Investment 57.15/share
Exdist expected 23rd or 26th June, last years distribution was 5.31/share zero franked

 

[RichKid]

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

Rozella,
Have you had much luck trading STW with this method? Any views of how the sp behaves, I note it tracks the XJO like a bloodhound. I've noted some big ex-div drops. Any idea what the next div will be? Ex-div on 26th June, link to co info page on ASX: http://www.asx.com.au/asx/research/...principalActivity=&industryGroup=NO#dividends

 

[rozella]

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

G'day RichKid,

Yes, it looks like it will go exdistribution on 26th June along with about 40 LPT's, but they have not announced as yet.

No, I don't trade STW as the volumes always worry me with huge gaps between buy/sell. atm 4978/4997....last price is 4963 @ 15:07:22

 

[RichKid]

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

G'day RichKid,

Yes, it looks like it will go exdistribution on 26th June along with about 40 LPT's, but they have not announced as yet.

No, I don't trade STW as the volumes always worry me with huge gaps between buy/sell. atm 4978/4997....last price is 4963 @ 15:07:22

Thanks Rozella,
It's a listed XJO tracking fund but the spread is wide as you say, it was 10c difference around the time I posted, from memory, I can see that's doubled. Interesting what you get to know about div's, I didn't realise so many would go ex div at once but tax time explains it.

 

[rozella]

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

G'day RichKid,

I was only guessing when I said 40 stocks would go exdividend/exdistribution on the same day.....well I was wrong.....last year there 64 on 24th June, which this year will be 26th June, the majority are LPT's. It just so happens that I am using the 23rd June 2005 as a Sample Watchlist on my website, so anyone interested can see which stocks may be coming up around that time, remembering that some of those stocks possibly don't exist, or circumstances have changed, so don't rely on information without checking the latest details.

For those that are not aware of STW, the following is their profile.

PRINCIPAL ACTIVITY
Street TRACKS S&P/ASX 200 Fund (STW) is an investment fund that tracks the S&P/ASX 200 Accumulation Index. The responsible entity for the fund is State Street Global Advisers, Australia Services Limited.

INVESTMENT STRATEGY: The Fund employs a passive investment strategy, investing in securities comprising the S&P/ASX 200 Accumulation Index in proportion to their relative weightings. The Fund may hold derivative contracts (such as forwards, futures, options and swaps over securities in the Index) if the investment manager believes that the Fund's investment objective can be better achieved by doing so. Derivatives will only be used for trading purposes (such as hedging to protect an asset in the Fund against fluctuation or as a substitution for trading physical securities), and not for the purpose of gearing the Fund.

 

[Bodhi2500]

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

Hi Rozella,

Could you help me understand an aspect of your 'sample watchlist'. I'm unclear how you get the 9.43 franking credit amount in the example below.

Code.......Last price...Div amt..Franking credit..Fr credit %
ANC.ASX.....875...........22...........9.43...............100



Thanks
Bodhi

 

[RichKid]

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

G'day RichKid,

I was only guessing when I said 40 stocks would go exdividend/exdistribution on the same day.....well I was wrong.....last year there 64 on 24th June, which this year will be 26th June, the majority are LPT's. It just so happens that I am using the 23rd June 2005 as a Sample Watchlist on my website, so anyone interested can see which stocks may be coming up around that time, remembering that some of those stocks possibly don't exist, or circumstances have changed, so don't rely on information without checking the latest details.

For those that are not aware of STW, the following is their profile.

PRINCIPAL ACTIVITY
Street TRACKS S&P/ASX 200 Fund (STW) is an investment fund that tracks the S&P/ASX 200 Accumulation Index. The responsible entity for the fund is State Street Global Advisers, Australia Services Limited.

INVESTMENT STRATEGY: The Fund employs a passive investment strategy, investing in securities comprising the S&P/ASX 200 Accumulation Index in proportion to their relative weightings. The Fund may hold derivative contracts (such as forwards, futures, options and swaps over securities in the Index) if the investment manager believes that the Fund's investment objective can be better achieved by doing so. Derivatives will only be used for trading purposes (such as hedging to protect an asset in the Fund against fluctuation or as a substitution for trading physical securities), and not for the purpose of gearing the Fund.

Thanks Rozella, I've found more info in the STW/Streetracks threads too.

 

[rozella]

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

Hi Rozella,

Could you help me understand an aspect of your 'sample watchlist'. I'm unclear how you get the 9.43 franking credit amount in the example below.

Code.......Last price...Div amt..Franking credit..Fr credit %
ANC.ASX.....875...........22...........9.43...............100



Thanks
Bodhi

G'day Bodhi2500,

ANC is 100% franked.....22 x 0.42857 = 9.43

Franking credit = dividend x 0.42857 if it 100% franked (example)
Franking credit = dividend x 0.42857 x 0.80 if it 80% franked (example)
Franking credit = dividend x 0.42857 x 0.35 if it 35% franked (example)

The 0.42857 comes from a gross dividend of (example) 100 cents
Companies pay a 30% tax rate
Net dividend is 70 cents
Tax is 30 cents (franking)
30/70 = 0.428757

So if the dividend was only franked to 57.5% as in the case of ALZ (on the sample watchlist) Franking credit = 4.0 (div) x 0.42857 x 0.575 = 99.0

 

[Bodhi2500]

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

G'day Bodhi2500,

ANC is 100% franked.....22 x 0.42857 = 9.43

Franking credit = dividend x 0.42857 if it 100% franked (example)
Franking credit = dividend x 0.42857 x 0.80 if it 80% franked (example)
Franking credit = dividend x 0.42857 x 0.35 if it 35% franked (example)

The 0.42857 comes from a gross dividend of (example) 100 cents
Companies pay a 30% tax rate
Net dividend is 70 cents
Tax is 30 cents (franking)
30/70 = 0.428757

So if the dividend was only franked to 57.5% as in the case of ALZ (on the sample watchlist) Franking credit = 4.0 (div) x 0.42857 x 0.575 = 99.0

Thanks.

Bodhi

 

[rozella]

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

Correction:

So if the dividend was only franked to 57.5% as in the case of ALZ (on the sample watchlist) Franking credit = 4.0 (div) x 0.42857 x 0.575 = 99.0

That should be Franking credit = 4.0 (div) x 0.42857 x 0.575 = 0.99 (It is correct on the sample watchlist)

 

[Bodhi2500]

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

Heya Rozella

30/70 = 0.428757

Shouldnt this be:

30/70 =0.42857 (?)

Another question regarding the 45 day/under $5000 rule... If you acquired more than $5000 worth of franked credits in under 45 day trades, is it the case that you cannot claim for only those over the $5000 limit, or do you forfeit the ability to claim for any of the under 45 day trade credits?

Cheers
Bodhi

 

[rozella]

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

G'day Bodhi2500,

30/70 =0.42857

I thought thats what I wrote

Another question regarding the 45 day/under $5000 rule... If you acquired more than $5000 worth of franked credits in under 45 day trades, is it the case that you cannot claim for only those over the $5000 limit, or do you forfeit the ability to claim for any of the under 45 day trade credits?

If you go over your $5000 limit, you can only claim those franking credits for trades greater than 45 days + the buy & sell days......you forfeit all franking credits for trades under 45 days.

 

[Bodhi2500]

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

If you go over your $5000 limit, you can only claim those franking credits for trades greater than 45 days + the buy & sell days......you forfeit all franking credits for trades under 45 days.

Thanks Again.

Bodhi