Quote Originally Posted by CJ View Post
A couple of points:
- unlike property, there is no tainting. Just because you hold one share for trading, does mean the hold portfolio (or all associated portfolios) are tainted.
- it is on a share by share basis.

As such, diferent portfolios is not needed but is good practice.
Agreed separate portfolios are good but not necessary.


The thing I struggle with as a buy and hold investor, is how can I buy a share like Xero or DIL (both small parts of my portfolio at purchase price), Obviously growth, not dividend stocks. However, they do form part of a diversified portfolio. And I fully expect them to become good dividends stocks at some stage - DIL in the next year or so and Xero in about 3-5 years.

Or how about RYM - dividend yeild is pathetic but combine with Growth, a good stock as part of a diversified portfolio. Even some of the utilities I own pay less than the interest rate on my margin account.

I am obviously not buying for a quick, or even mid term trade but if you look at the yield I get, potentially you could argue at least 50% are not bought solely for yield.
It should not matter too much which stocks you have in your portfolio as long as you can justify you bought them on the basis that they had increasing EPS and that will fund future dividends.

I would be more concerned with how many trades you do a year (entering or leaving a share) and the average time frame you are in the share.

In theory it should not matter if you fund your investing through equity or debt when it come to determining if you are investor or trader. However in practice the IRD are more likely to say you a speculating if you have bought on margin. Secondly if you are claiming loss and booking capital gains you maybe more likely to get target for an audit.