Anti-Trader Tax Petitions

ByStander

Option case is much worse because it is based on the notional value.
bobcat 发表于 2009-12-10 17:55

What's the rate for options, 0.25% or 0.02%? Thanks

bobcat

What's the rate for options, 0.25% or 0.02%? Thanks
ByStander 发表于 2009-12-10 18:12

I believe it is 0.02% on the notional value. So OM options are gone.

Diffusion

I believe it is 0.02% on the notional value. So OM options are gone.
bobcat 发表于 2009-12-10 18:27

What is "on the notional value"? Meaning I buy 1 option at strike price $100 will be taxed as I buy 100 shares at $100?

bobcat

What is "on the notional value"? Meaning I buy 1 option at strike price $100 will be taxed as I buy 100 shares at $100?
Diffusion 发表于 2009-12-10 18:31

http://en.wikipedia.org/wiki/Notional_amount

bobcat

More information

I just found out that another formidable force behind this tax is from  mutual funds,
particularly certain index funds such as from Vanguard.
Many of these mutual funds are almost passively managed
and fall behind benchmarks year in year out. They survive
because the regulation requires that certain retirement funds
be with them.  They have lost more and more business to HFs.
They believe this tax will drive many HFs off shore. I think it will.

In about 10 years ago, these mutual funds started
requiring that your investments be locked for a few months unless
you pay a penalty. This way they do much less work and transfer
considerable amount of risk on investors. In my point of view, mutual
funds are no longer a valid investment vehicle unless your 401K plan
dictates that.

Jim Rogers is right. He has been saying for years that money should go
Asia.

NumberRules

36# bobcat


holy....1 tick can only make u $12.5, so basically 2 ticks for that stupid tax and at lease 1 tick for broker (depend...)..

without a full pt gain will be no profit at all.

NumberRules

35# ppteam

W. Buffet pros every shitty tax, his comments on tax have no value at all.

bobcat

I think the actual cost will be a lot higher because loss of liquidity
and higher commission rate.
I'd say for stock trading around 1% at least.
So if a day trader turns over his portfolio once a day, he would need
to make 1100% a year w/o this tax to just break even.
Also please note that you need to be able to get this 1100% w/o using margin.

bobcat

I have been doing some system analysis lately. What if I hold for
a longer period of time, such as 20 days? The problem is then
the return is much lower and I still cannot overcome this tax.
The only possibility is to hold for a very long term, but then the risk
is much much higher.
In China, although the stamp tax makes it impossible to day trade,
the short term trading is much more profitable than in US, because
the market there is much less efficient.

netfire

Trader tax is a complete scam. Don't we pay capital gains tax already? enough is enough.

bobcat

35# ppteam

W. Buffet pros every shitty tax, his comments on tax have no value at all.
NumberRules 发表于 2009-12-11 10:31

Buffett  has lost the entire last decade and  fallen far behind other good managers.
He understands well that there are two main reasons for this:
(1)  the market liquidity  and efficiency  made him very hard to find a super deal (or steal) anymore;
(2)  he has been opposing new technologies and inventions which require funding by speculators.

humbletrader

deleted

dara

I think the actual cost will be a lot higher because loss of liquidity
and higher commission rate.
I'd say for stock trading around 1% at least.
So if a day trader turns over his portfolio once a  ...
bobcat 发表于 2009-12-11 10:42

That is what I said in my early post.

If that truly happens, basically IB, AMTD or ETFC will charge you $100+ per transaction, otherwise they would go BK.

Also, with 0.25% tax, IRS will would get 0.5% free $ even that 股票only 换手一次 in one year, and SPY's yearly div is only 2%.

Who the h*ll in the world would buy US 股票?

ksd9235

how does this impact foreign accounts?

guess it's time to shift money to forex markets now