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366 day trading strategies

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stockgod

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I have just had an idea. dont know if its been done before or not. The theory is this. Buy a stock with dividend payments of 5% or higher (tls or the banks) on the day the stock goes X dividend, hold for a following 366 days and recieve the mid year and final dividend. So in turn you recieve 3 dividends and a possible 4th special devidend in the space of 1 year and 1 day. Sell your holdings pay half capital gains and move onto the next stock! This would create income thru dividends of around 7.5% for the year and 1 day.

What are peoples thoughts?
 
Re: 366 day trading strategies.

Nice theory.

Now if the stock drops 15% in value over the 366 days?

Doh!!
 
Re: 366 day trading strategies.

And if it was being done regularly with a fair number of stocks, the ATO might decide your operation was a business and then bye bye the 50% discount.

Although at least then if the stock did fall in price, you'd be able to offset the loss against the dividend income and possibly your own income.

GP
 
Re: 366 day trading strategies.

Sure i understand the stock could drop 15% but with divis of 7.5% then this makes it only a 7.5% loss. Dont get me wrong i wont be holding just for the divis, i will be watching closely.
 
Re: 366 day trading strategies.

Why not check this stategy out and other + cash flow startegies from crashy's website.

Next thing is you will be wanting to try out with an Instalment Warrant
 
Re: 366 day trading strategies.


This theory has been around for quiet a long time now.

It has is pros/cons. As you mentioned, you can get some good divds from the Banks every time and get the 3 divds in 366 days. And as some people mentioned, you can loose money if the price of the share drops more than what you are getting from the divds.

Now, the interesting point here is that when there is a bull market (currently in Australia) people forget about the profits and go for the growth. People are trying to get the quick buck trading stocks based on charts and daily trades and sometimes investing without fundamentals.

If you are looking for some income in the long term that strategic could work and we can improve it using teh same basic but buying before the XD day and selling some time after the XD day (but, get didvs and sell) and then doing it over and over again with another share. As before this strategic has pros/cons but it could work as well.

http://australiansharemarket.blogspot.com
 
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