ATM - A2 Milk Corporation Limited

[Cyclical]

Good points. Obviously - nobody can foresee the future ... and if for some reason their biggest market (China) decides to discriminate against NZ product (as they currently do against US and Australian product), then EPS (and with it share price) trend well might take a dip.

Not saying this is going to happen, but just one risk shareholders need to be aware of. A2M is a classical high risk - high reward story.

Some Aussies seem to think it's theirs anyway (the dangers of being on the ASX). Hopefully the Chinese are able to discriminate (the differentiate meaning of the word of course ).

[couta1]

It's effectively another form of shorting is it not, something that you seem to be the master of. I've done it on the odd occasion myself, although usually I get the timing completely wrong and it comes with regret!

Exactly, its basically shorting your own shares, done in a controlled manner it is an excellent strategy and a good way to stay positive during difficult times.

[Cyclical]

Exactly, its basically shorting your own shares, done in a controlled manner it is an excellent strategy and a good way to stay positive during difficult times.

Umm, noob question here...it's something I've been struggling to find the answer on but keen to know. From a tax perspective, and I know it's very grey in NZ, but your strategy there could potentially realise a loss on the books, which would be mean less tax to pay (assuming you're classified as a trader) come return time, which would be a nice little bonus to such a strategy (especially if you manage to buy back in at a lower price). But would tax be calculated on the realised gain/loss only, or are we supposed to work it out on capital gain too, or are there different options for calculating, or is it all just too grey?

Sorry for the deviation from topic.

[couta1]

Umm, noob question here...it's something I've been struggling to find the answer on but keen to know. From a tax perspective, and I know it's very grey in NZ, but your strategy there could potentially realise a loss on the books, which would be mean less tax to pay (assuming you're classified as a trader) come return time, which would be a nice little bonus to such a strategy (especially if you manage to buy back in at a lower price). But would tax be calculated on the realised gain/loss only, or are we supposed to work it out on capital gain too, or are there different options for calculating, or is it all just too grey?

Sorry for the deviation from topic.

Tax would only be payable on any realised trading gain and yes a loss on the books means less or no tax to pay, capital gains are not taxable if there is no sole profit intent upon purchase, our current system is however as you say grey.

[bull....]

So it is possible to teach an old bull new tricks, sure you can just hold and wait until the price comes back to your avg buy in price or you can be proactive and end up with more shares once it does come back up, every extra 100 shares equals 2 grand approx, you have gained money because you end up holding more shares than you originally had.

eh so your buy more shares after selling them for a loss and hope like hell they go up because if they go down after your brought more then your just be making more big losses with those extra shares. sounds very risky you must be very good at timing the market to make this work.

i would think a better strategy would be to own the stock and short it with cfd's in another account .
if you think its going to decline that way you protect your capital position. take off the short when you think its going to go back up and wohoo not only have you lost nothing but your enjoy even more gains on the way up. of course if it continued to go up you would lose. so no strategy is without risks to some degree

[Cyclical]

eh so your buy more shares after selling them for a loss and hope like hell they go up because if they go down after your brought more then your just be making more big losses with those extra shares. sounds very risky you must be very good at timing the market to make this work.

i would think a better strategy would be to own the stock and short it with cfd's in another account .
if you think its going to decline that way you protect your capital position. take off the short when you think its going to go back up and wohoo not only have you lost nothing but your enjoy even more gains on the way up. of course if it continued to go up you would lose. so no strategy is without risks to some degree

He's hoping to sell at ~$18, then spend the same amount of money to buy ~5% more shares at ~$17. I'm not sure how that is hard to understand. Sure there's risk, it might bump back up and he has to buy back in at ~$19 and effectively have ~5% less shares for the same money. But no more or less risky than shorting as far as I can see. Plus a potential tax advantage as discussed above.

[bull....]

He's hoping to sell at ~$18, then spend the same amount of money to buy ~5% more shares at ~$17. I'm not sure how that is hard to understand. Sure there's risk, it might bump back up and he has to buy back in at ~$19 and effectively have ~5% less shares for the same money. But no more or less risky than shorting as far as I can see. Plus a potential tax advantage as discussed above.

being able to claim a tax loss is not something i would consider good because it means you actually lost a lot more capital. i would rather pay tax

[jimdog31]

According to AFR

"Bortolussi will take up the top job early in 2021, just as Babidge prepares for the delivery of his new motor cruiser boat. Babidge also recently purchased a home in the NSW Southern Highlands, where he will spend time with family, although it might be a while until his son, daughter-in-law and two grandchildren can visit from New York City.

Seems like a legit reason to cash in some shares......

[Cyclical]

being able to claim a tax loss is not something i would consider good because it means you actually lost a lot more capital. i would rather pay tax

Let's say you've been busy trading since April the 1st and in that time you'd realised a $100k gain (we'll run with easy numbers for argument's sake). You're in the top tax bracket, so you're currently staring down the barrel of a $33k tax bill for your trading efforts. You've got $1m worth of ATM stock with an average buy of $20/share. It pulls back to $18, you sell, booking a loss of $100k. You buy back in tomorrow at about the same price. You've still got the same assets (capital) as you had the day before, plus you won't be paying a $33k tax bill next year. Meanwhile the shares are at $25 come March 31 next year, but you won't be selling them, so still no tax.

Have I got that right, Couta? Beagle, you're our resident accountant, no? Am I off the mark?

[couta1]

Let's say you've been busy trading since April the 1st and in that time you'd realised a $100k gain (we'll run with easy numbers for argument's sake). You're in the top tax bracket, so you're currently staring down the barrel of a $33k tax bill for your trading efforts. You've got $1m worth of ATM stock with an average buy of $20/share. It pulls back to $18, you sell, booking a loss of $100k. You buy back in tomorrow at about the same price. You've still got the same assets (capital) as you had the day before, plus you won't be paying a $33k tax bill next year. Meanwhile the shares are at $25 come March 31 next year, but you won't be selling them, so still no tax.

Have I got that right, Couta? Beagle, you're our resident accountant, no? Am I off the mark?

You understand.