Investment BS Thread - Stocks/Futures/Mutual Funds/Bonds/Commodities/Options/ETFs/401ks/Etc

If a company buys its own shares, are they free to return those shares to market at anytime?

 

If they're doing a true buyback, they retire them. That is where shareholders benefit, the outstanding share count drops.

 

Ah, then that’s effectively an equity dividend. Instead of the pie cut into 1,000 pieces and you own 100 pieces, the pie is cut into 750 pieces but you still own 100 pieces.

 

That is exactly how it is intended to work. If you look at Apple's outstanding shares, the count has shrunk like crazy over the last several years, so your share becomes more valuable over time:

 

And if you're holding that stock in a non-retirement account where you have to pay tax on cash dividends, with the buyback you have deferred your taxes and put them in the lower long-term capital gains tax rate. Nice!!

 

$LYFT weekly chart.

 

Mmmm, cherry fruit roll ups!!

 

One of the big arguments against it is that it just makes the high level executives richer. Well, if a CEO knew that a huge buyback was coming on a certain day, and then sold their shares as the price got propped up due to the buying, I would imagine that's some kind of SEC violation? If it's not, it sure should be. The other argument against it is that there are better ways to spend the money, but I think in some cases, a buyback might be the best. Other cases, there probably are better ways to spend that money.

 

@honda50r, so this is how this is going. i was on biggerpockets forum talking and most whole Salers there agreed with my logic on pricing. They also said if he’s got that big of a margin he’s the best wholesaler ever lol. He gave me the ARV of 230,000.

The guy keeps hitting my phone up to buy it.

Most have said that new wholesalers don’t run all numbers and just get caught up in ARV and that’s why this guy can’t sell it. The numbers don’t add up enough for most investors.

 

to the NIO owners how much have you gambled on it?

 

For those of you who invest in dividend stocks and reinvest the dividends, what is a strategy you follow and what stocks do you buy? What do you recommend for someone just starting out?

Thanks in advance

 

I'm only in for 100 shares. I got in at $5.23/share. But if it dips lower into the $4 range I will throw some more at it.

 

If you're just starting out, remember that you have to pay tax on the dividends, so unless they are held in your retirement account (where you avoid the tax) it might make more sense to invest in non-div stocks if you don't need the dividends to pay your living expenses. No fun to share those divs with Uncle Sugar!

 

I started by looking at the list of Dividend Aristocrats (companies that have increased their dividends for 25+ years). I used those stocks as a base, and about half of my portfolio comes from that. Then, just look for other solid dividend payers to add to it. Finally, I made about 25% on my portfolio REITs. I wanted real estate exposure without having to actually buy properties. Also, REITs pay good dividends.

Of course, you will want to find a process to screen all of the individual companies to meet whatever standard you set.

My portfolio is yielding about 4.8%, so no matter what the market does, I at least get that. It did go up about 12% in Q1 this year on top of that, so it’s on par with the regular market too.

 

$0.

I had 10 shares and made 75% when it went from $6ish to $10. Got out right at the top (something about a 60 minutes interview.. it was a classic pump and dump scheme). Made like $20 or something lol.

Watching closely though. Too much downward pressure during market hours (did you see all the red candles I posted?)



Might be a good time to buy, but I'm waiting to see what happens when it crosses $5 again. Wouldn't throw a lot of money at it though.

 

I too am throwing $0 at nio. In related news lawmakers are looking to expand the EV credit. The usual suspects will get a benefit, but don't be surprised when Ford comes out with a plug in hybrid f150 and starts padding their pockets with this ev credit as well.

 

It's the Tesla effect, too.. I bet. Everyone is scrambling on rumors of an e truck. Even though a Tesla e truck probably won't happen for at least another 5 years haha

 

NIO testing $5 hardcore today

 

I agree with you there, Tesla is very optimistic with their release dates, and model Y will need to come first. Although first to market with an EV truck that can double as having auxillary power to run/charge equipment is going to get a ton of fleet orders. The demand is there with larger companies/municipalities. Who knows, maybe Toyota will surprise us with the 2020 Tundra.

 

Frame won’t rust?