PGW - PGG Wrightson

[couta1]

The short answer to that is tax. A trader is liable to income tax on any gains whereas a long term investor is not
I like and share Snoopy's approach with most of my investments but also run a small trading portfolio separately

Actually iceman under our current very grey tax law anyone who bought and collected a divvy then sold to protect capital and then repurchased would not be liable for tax because their intent at time of purchase was to acquire dividends not to make a profit by reselling, intent at time of purchase is what determines if you pay tax not your reason for selling but capital protection would have to be the most water tight reason for selling anyways.

[iceman]

Actually iceman under our current very grey tax law anyone who bought and collected a divvy then sold to protect capital and then repurchased would not be liable for tax because their intent at time of purchase was to acquire dividends not to make a profit by reselling, intent at time of purchase is what determines if you pay tax not your reason for selling but capital protection would have to be the most water tight reason for selling anyways.

I think one would struggle to convince the IRD of that if it was a regular occurance. Agree the tax law is grey but IRD certainly looks at frequency of trades

[couta1]

I think one would struggle to convince the IRD of that if it was a regular occurance. Agree the tax law is grey but IRD certainly looks at frequency of trades

Possibly but by collecting and paying tax on the divvies IRD would have a hard job proving your intent was otherwise even if it was a regular occurrence. Most serious traders don't care about divvies full stop.

[iceman]

Possibly but by collecting and paying tax on the divvies IRD would have a hard job proving your intent was otherwise even if it was a regular occurrence. Most serious traders don't care about divvies full stop.

Different strokes for different folks mate. Regularly trading around dividends is not an approach I would be comfortable with for my tax free (capital gains) investment portfolio. But this has been debated on different threads and people clearly have different views on it

[Baa_Baa]

But Baa Baa at the moment we are waiting for the PGW dividend and others like SPK not in between them

That avoids the question, introducing the 'right now' situation doesn't defunct my question, whether the methodology could be implemented profitably. Your subsequent posts suggest that you think that there is doubtful exposure to tax implications. Hence there is a window where one can enjoy a dividend, sell the stock in a downtrend, buy in again later at a lower price, to enjoy the next dividend, and at higher yield.

[couta1]

Different strokes for different folks mate. Regularly trading around dividends is not an approach I would be comfortable with for my tax free (capital gains) investment portfolio. But this has been debated on different threads and people clearly have different views on it

Yep its a bit like how long is a piece of string, everyone must make their own mind up on where they stand, cheers.

[Baa_Baa]

Different strokes for different folks mate. Regularly trading around dividends is not an approach I would be comfortable with for my tax free (capital gains) investment portfolio. But this has been debated on different threads and people clearly have different views on it

Appreciate your reply iceman, I would need to get into the detail of what IRD consider 'trading' (though couta suggests that it is grey, and is not trading to sell and buy for a dividend - ergo intent), I'm asking partly because despite the encouraging commentary here, PGW is in a confirmed downtrend, yet the mainstream view is that that is OK (to diminish capital) as long as the dividends consistently follow. That's why I wonder if a more active approach to managing capital is a realistic approach.

[couta1]

That avoids the question, introducing the 'right now' situation doesn't defunct my question, whether the methodology could be implemented profitably. Your subsequent posts suggest that you think that there is doubtful exposure to tax implications. Hence there is a window where one can enjoy a dividend, sell the stock in a downtrend, buy in again later at a lower price, to enjoy the next dividend, and at higher yield.

That first post was just a cheeky one Baa Baa, so yes as you observed in the subsequent posts I agree with your thinking

[iceman]

Agree Baa Baa that PGW is in a confirmed downtrend. The report this week did not give me confidence that PGW will be able to maintain current level of dividends, so I made an exit with my holding. Still like this well managed company, just not for me at the moment

[couta1]

Agree Baa Baa that PGW is in a confirmed downtrend. The report this week did not give me confidence that PGW will be able to maintain current level of dividends, so I made an exit with my holding. Still like this well managed company, just not for me at the moment

Interested in how you differentiate between this stock and HNZ which is also in a confirmed downtrend and even if PGW cut their dividend its still likely to be at least equal to or better than HNZ. Hold both but more PGW.