Tax deductible expenses

[Warren Buffet II]

Hi roofus,

I guess you are in some way gambling but I can think of one way I consider you are not:

1) if you buy a company after they announce its results and you receive dividends that is not gambling as that is a fact you will receive the didvs if you keep the shares after the XD day.

It is a very fine line between investment and gambling.

Regards,

 

[Warren Buffet II]

Hi roofus,

Check the next website, it has a very interesting discussion about the differences between investing and gambling.

http://www.tomments.com/tomments3a.htm

regards,

WBII

 

[Warren Buffet II]

Hi Roofus,

For those who do not want to read the whole thing, this is the definition that the author concluded it is the correct:

Investing - "Any activity in which money is put at risk for the purpose of making a profit, and which is characterized by some or most of the following (in approximately descending order of importance): sufficient research has been conducted; the odds are favorable; the behavior is risk-averse; a systematic approach is being taken; emotions such as greed and fear play no role; the activity is ongoing and done as part of a long-term plan; the activity is not motivated solely by entertainment or compulsion; ownership of something tangible is involved; a net positive economic effect results."

Gambling - "Any activity in which money is put at risk for the purpose of making a profit, and which is characterized by some or most of the following (in approximately descending order of importance): little or no research has been conducted; the odds are unfavorable; the behavior is risk-seeking; an unsystematic approach is being taken; emotions such as greed and fear play a role; the activity is a discrete event or series of discrete events not done as part of a long-term plan; the activity is significantly motivated by entertainment or compulsion; ownership of something tangible is not involved; no net economic effect results." (These definitions have been added to our InvestorWords.com glossary, replacing the old definitions, which were admittedly no better than the ones offered by other dictionaries.)

Regards,

WBII

 

[roofus]

WB2- Gday, If i only hold stock(s) for 24 hrs, Im a bit confused how I would obtain a dividend? Anyway, even if I did hold the stock long enough to get the dividend, its still a gamble as the price of the stock might fall greater than what the div. was.
I think Ive read that quote before, it might have been from a book called The Luck Business

 

[Warren Buffet II]

WB2- Gday, If i only hold stock(s) for 24 hrs, Im a bit confused how I would obtain a dividend? Anyway, even if I did hold the stock long enough to get the dividend, its still a gamble as the price of the stock might fall greater than what the div. was.
I think Ive read that quote before, it might have been from a book called The Luck Business

Hi Roofus,

You can get the divds in 24 hours buying one day before the XD day (when the company is trading CD) and selling on the XD day.

It doesn't matter if you loose or make a profit but you are sure you are getting that divds money.

Regards,

WBII

 

[roofus]

WB2-sorry my mistake,ur right. Ive got 5 conversations going at once

 

[RichKid]

Any chance of an electronic copy of the transcript (I assume your counsel would have got one by now)? You can private msg me about it if you prefer. Or just a reference to the decision, but I have a feeling it'll take a few months for the result to be released.

 

[RichKid]

Got more links Roofus?? Post em here if you do please.

 

[markrmau]

It has been raining over the last few days and the punters don't think bgf will go so well on a muddy track. However I think we are in for some clear weather and so I stuck a few more thousand on a horse called bgfo.

How can anyone say this is different from gambling?

Roofus, in the judge decision, was there any differentiation between blue chips and speculative stocks?

 

[tech/a]

If you trade like its a gamble and punt like its a gamble well thats what it will be.

I trade and make good $$s Im not gambling not even remotely!

If I take a short term trade however THEN Im gambling------Why because I have no idea of my expectancy and I dont have a methodology which has a proen long term profitability.
Ive taken a short term punt for a possible gain.

If my trading is structured with positive expectancy like any business plan showing cashflow and assets/liabilities and costs of business/expected return then thats not a gamble.

Could possibly be described as a quantified risk,I guess.

Mark YOU ARE gambling.(from what I can see).Doing pretty well I see in some.

Ask a Bookie if he thinks hes gambling!!

 

[markrmau]

Absolutely! I have done no back testing on my trading method so I have no idea if it is profitible in the long term. In fact, I will readily concede that I would probably be broke if this wasn't one of the best bull markets aus has seen (ever?). I am basically gambling.

I also note that if I took a net loss, I would not be able to offset it from my normal taxable income.

 

[roofus]

Morning all ill post shortly, just off to the races at the moment, email me for results if you like.
Mark- yes the judge in the middle of the hearing disputed against the Commisioner and stated that he (the judge) believed that short term trading could be defined as gambling, its not all cut and dry. Be back soon.

 

[roofus]

Back again, got a 1st and a couple of placings.
Mark- yes the judge did realize that stocks are of different prices, and admitted that lower price stocks are riskier. really though, thats like saying that if you buy BHP, your less likely to lose money, so its not a gamble. I saw BHP went down the other day, anyway. He also found it interesting as to where the description "blue chip" came from.