What records must you keep for the tax man?
Jimmy B Prince, author of Tax for Australians for Dummies Under Australian tax law all taxpayers and more particularly investors are required to keep accurate records of their financial transactions. Keeping proper records are primarily required for the following purposes: 1. When you lodge your annual individual tax return you need to disclose all assessable…
What happens if the stock that I have margin lent against falls off the approved list?
Brokers from time-to-time may reduce or remove the Loan to Value Ratio (LVR) on particular stocks. If this does occur to you and your Loan to Security Ratio (LSR) increases to a level higher than your margin call LSR, then a margin call will trigger and you will required to reduce your gearing level by…
What happens if your CFD stock gets suspended from trading or worse, goes under?
What happens to your CFD trade if the stock that you’ve gone long or short gets suspended from trading or worse, goes under? In the Australian Securities Exchange (ASX), listed companies can either voluntarily or be ordered by the exchange, to have their securities placed in to a status where trading is restricted. This status…
What is the ideal mix of companies?
There is no such thing as a universally ideal share investment, because all investors are different. In particular, different investors have different attitudes to risk, liquidity and investment horizons. Brokers often try to help their clients choose stocks by producing lists of companies classified in various ways – for example, growth companies and value companies….
What is the price/earnings ratio of the overall market?
By Nick Renton AM Share investors are no doubt familiar with the concept of the price/earnings ratio for an individual stock. This ratio is defined as the market price of a share expressed in cents divided by the earnings per share also expressed in cents. The ratio can be described as the number of years’…
What news, indicators and events move stocks the most?
he share market is so volatile at the moment that it can move sharply the instant any economic news is released. Investors can feel obliged to react quickly and then regret their actions, but it is hard not to be swayed by the news of the day. How does the investor or trader filter through…
What does it mean to be positively or negatively geared with margin lending?
What does it mean to be positively or negatively geared with margin lending, and what circumstances would you use each? Response: An investor has a positively geared margin loan when the dividends payments exceed the interest costs. In such a case the income stream from the investment is (more than) self-funding. If the investor is…
Should I take out a fixed or variable margin loan?
I’m not sure whether I should take out a fixed or variable rate margin loan. What are the advantages and disadvantages of each, and what type of investor do they suit? Your choice of interest rate on a margin loan (variable or fixed) depends on your financial and tax circumstances, your opinion as to the…
Should I buy a warrant on the primary or secondary market?
What is the difference between buying a warrant from a warrant issuer and buying it on the ASX? What are the pros and cons of each? Response: Buying a warrant from a warrant issuer is often referred to as purchasing through the primary market. Buying a warrant on the ASX is referred to as a…
What is pairs trading?
Market Neutral or Pairs Trading is a strategy designed to benefit traders in all market conditions. Whether the market goes up, down, or sideways, the strategy has a higher probability of generating profitable results whilst generally employing lower risk. It is one of the most popular strategies employed by hedge funds and, via the use…
