Judge Smails
Footballguy
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Stock Thread (22 Viewers)
- Thread starter St. Louis Bob
- Start date
Judge Smails
Footballguy
Congrats all on CYDY! Missed the boat but cheering you on. Remember us little people!
chet
Footballguy
I don't want to tell you how to trade but you can buy another stock before your sell settles.
chet
Footballguy
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ghostguy123
Footballguy
Quick random question on tax implications.
Say you buy 1000 worth of a stock and it triples to 3000. If you sell 1000 worth and leave the rest alone, would you have to pay any taxes on the 1000?
Say you buy 1000 worth of a stock and it triples to 3000. If you sell 1000 worth and leave the rest alone, would you have to pay any taxes on the 1000?
Shula-holic
Footballguy
Yes. You have to allocate the cost to your shares. Many firms use FIFO (First in, first out) method if you bought multiple lots at different prices. But you'd report a gain in your example of $667 ($1000 revenue - $333 cost).
My understand is yes. You report the cost basis on your tax form and them you report what you sold it for.
ghostguy123
Footballguy
Ok.
And I assume these site like Fidelity calculate all this for you.........at least I sure hope so
Shula-holic
Footballguy
Well yes, they'll send you a report. But from experience, it's incumbent upon you to report the cost basis. They report the sales basis to the IRS. My parents failed to list a mutual fund sale once and the tax bill came in as if they had zero basis. I had to research it for them and document their cost basis to have that part of the penalty abated.
Charlie Harper
Footballguy
Thanks. I'm still learning how to trade. Re-read cash account violations and looks like I completely misunderstood "good faith violation". If my understanding is correct I can sell LUV and buy CYDY, but I just can't sell CYDY until it settles.
My question now since market is closed and I'll be placing orders tonight to get at open tomorrow..does order of operations matter?
Lets say I have $100 in settled cash and 10 shares of LUV. What's the best way to get CYDY?
Option A
1) Sell LUV
2) Buy CYDY with proceeds from LUV and $100
Option B
1) Buy CYDY with settled $100.
2) Sell LUV
3) Buy CYDY with LUV proceeds.
Also, will I be able to accomplish this with limit orders pre-market? Or because I don't know what LUV will sell at and CYDY will open at I have to do this myself at open?
Basically....tell me how to trade! Thanks.
Get TurboTax, I can’t imagine they don’t have all that not importing automatically. I may seem like I know stuff but I haven’t had to report any gains or losses in a while as all my investments had been retirement only until a year ago. Gotten a lot smarter in a year thanks to this thread.
Sand
Footballguy
Assuming you have a cash account Option A is the easiest. You can buy stocks with non-settled cash, but you want the CYDY trade to settle (3 days) before trading again. Trading multiple times on unsettled cash is a violation and the brokerage will be unhappy with you - the good faith violation. But as long as you hold CYDY until it settles all is good.
If you really want to move around a lot you want a margin account.
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The General
Footballguy
Sand
Footballguy
I have Fidelity and everything just gets loaded into TT every year. Easy peasy. I don't trade much, so just go with Fid's FIFO basis matching.
chet
Footballguy
I don't know of any rule that would preclude you from selling the CYDY in your example. You sell LUV and have $10K that settles in 3 days. You then buy CYDY same day and the next day it's up and you want to take a profit. I don't know of any rule that prohibits the sale of CYDY.
ETA: Apparently, you should have a margin account to do the above.
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Shula-holic
Footballguy
I do now. The worst part is I still do my dad's taxes but not my own. I'm a CPA but have a CPA firm do mine for me personally and my business to keep distance in between myself and that reporting. But regardless, unless it's changed, the IRS reporting that brokerages do is a lot more stringent on the revenue side. It's on you to document your cost basis. Your brokerage will give it to you. Just make sure you report it right initially. Missed sales where the IRS always will assume a zero cost basis is a big time PITA to clear up. My in-laws made a similar mistake once by not picking up one sale out of a laundry list. Took me awhile to get that corrected for them as well.
Shula-holic
Footballguy
Sand
Footballguy
Maybe I misunderstand the good faith violations. I thought moving twice with unsettled cash was a no no.
Edit: Nope, I have it right. Gotta let the buy settle so you have completed the transaction with settled cash.
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Shula-holic
Footballguy
I think you can do it on a margin account, not cash. Been forever since I had a margin trading account, probably 10 years so I'm pretty rusty and those requirements are likely outdated.
Charlie Harper
Footballguy
Correct, cash account. Is option A something I can do with limit orders pre-market or does the uncertainty of the prices force me to do it manually tomorrow at open?
Sand
Footballguy
I don't do off hours trading, so don't know. If you do Option A you're locked in to CYDY for 3 days to let it settle. Fidelity, at least, will let you have three strikes then will restrict your account if you violate that. There is always the chance CYDY goes into freefall, so you are giving up some selling flexibility for the buying flexibility.
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NajehHejan
Footballguy
I've been dollar cost averaging into SCHD and scooped up more yesterday when it was big time in the red. The shares I bought yesterday settle tomorrow. I just noticed that the quarterly dividend record date is today. 
CR69
Footballguy
He can probably sell the LUV AH. Is there a brokerage that allows AH trading of OTC stocks?
Bluto Blutarsky
Footballguy
Hell no. You're gonna get a list of every trade you made at the end of the year, and it's up to you
I got a panic attack reading this and thinking of @BassNBrew
caustic
Footballguy
Otis
Footballguy
Thank you Chet on this. Awesome.
My failure was not holding onto more. I bought like 20 or 30 grand worth initially at around a buck, and started selling a bunch at 2x-3x.
I still hung onto about $5k worth that I bought at a buck, and today that chunk is worth $30k. LET IT RIDE. GOGOGO.
Golf Guy 69
Footballguy
#notselling
I only purchased this stock because of the person that introduced it.
I am playing checkers.
My philosophy, listen to the smart guy. I know nothing about investing, I am playing the person not the game.
GL all.
I only purchased this stock because of the person that introduced it.
I am playing checkers.
My philosophy, listen to the smart guy. I know nothing about investing, I am playing the person not the game.
GL all.
Golf Guy 69
Footballguy
Automated through brokerage and tax programs. Done for him.That was my first thought too.
unckeyherb
Footballguy
ghostguy123
Footballguy
If I just sell everything at the end of the year maybe that makes it easier?????
Seems like the stupid fidelity site should keep track of all of it.
Seems like the stupid fidelity site should keep track of all of it.
unckeyherb
Footballguy
-OZ-
Footballguy
I uploaded my brokerage statements to H&R block this year, checked them and they were right.
It's a hoot.
beef
Footballguy
Same here. Love TaxCut.
Before the upload days I'd use one line per stock and per short or long term. Used the Var-S or L for most of the dates. Not what the IRS prefers, but I made sure the totals match what TD reports to them and kept it simple. They never questioned it and it always passed the computer screening.
dkp993
Footballguy
So at this rate that’s what Wednesday or Thursday of next week.
My new black Porsche turbo will be named the chetmobie.
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GoBirds
Footballguy
Wasn’t this like the first stock you ever bought or close to it? That’s pretty amazing. Unfortunately, they aren’t all like this.
Zegras11
Footballguy
So I got in because I know you well, and you made a post about how well you knew Chet when it was around $2, April 2.
What's happened here for me is something eerily similar to what happened me in 2000 during the dot com bubble.
In 1994, I had a client call me up to pay his bill, and he told me about this penny stock. It was at 30 cents. He suggested I use some of my Sep-IRA contribution and buy some each year. So I bought like 123k shares over 6 years at an average of 35 cents. It traded between $0.10 and $1 those 6 years. 85% of the time in the .10 - .30 range. I think it hit $1 three times. Well there was some good news and it went from 20 to 50 cents.. and then a few days later to a $1. And then pretty much acted like this stock the last 8 days and went up to $6.45. I was all pegged to sell at $7.60. And it never got there. I did sell at $2.90 for like 900% profit and did very well. Put all that money in their sister company, that get this, was working on some imaging software, to quickly detect breast cancer. That stock eventually tanked to $0. Lost all the money. But started RE the next year
So when Chet first started talking about this, for about the first month, it sounded incredibly similar to before. OTC, pump and dump, blah, blah, blah. It wasn't that I didn't believe Chet, because I know he's a great guy and we've played FBG Hockey before, but I just wasn't ready to go through something like that again.
Cav's post convinced that this was different. The FDA tests are proof of that.
Let's hope for many more days of great news! GL to all.
dkp993
Footballguy
Very first! Unbelievable isn’t it. So fun. This whole stock thing is easy. Just take some advice from a stranger on the internet and watch the money roll in.Wasn’t this like the first stock you ever bought or close to it? That’s pretty amazing. Unfortunately, they aren’t all like this.
CR69
Footballguy
The General
Footballguy
eaganwildcats
Footballguy
BassNBrew
Footballguy
Betterbelieveit
Footballguy
I found this interesting. When the biggest betting single day game in town so far this year is down double digit millions short of the largest handle in a non Triple Crown year YOY, I find it crazy to buy into gaming stocks. Unless you are shorting them. Online horse gambling is legal in 41 states so there is plenty of availability to wager, and this is the year over year result.
https://www.nyra.com/belmont/news/2019-belmont-stakes-day-generates-record-handle-for-non-triple-crown-year24 131.9 million.
https://www.nyra.com/belmont/news/2020-belmont-stakes-day-generates-67,753,336-in-all-sources-handle
https://www.nyra.com/belmont/news/2019-belmont-stakes-day-generates-record-handle-for-non-triple-crown-year24 131.9 million.
https://www.nyra.com/belmont/news/2020-belmont-stakes-day-generates-67,753,336-in-all-sources-handle
Judge Smails
Footballguy
I think he was saying that there’s a lot of talk that since people are at home more that betting will increase. A lot of gaming stocks being bid up or not getting hit as hard, but the betting for one of the top horse racing events is down 30% this year and it’s the only game in town. We’ve yet to see the real revenue/earnings hit (Q2) so who knows.
GoBirds
Footballguy
That’s amazing. When we all cash out take at least half and invest in an index fund like Vanguard instead of gambling on another individual stock, we won’t repeat this. That is unless Chet has another recommendation for us, in that case we do whatever he says.
