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It's an important strategy for saving income taxes. You sell the stock at the end of the year to take the loss and buy back because you believe in the stock for the long term. The risk is that the stock will have a run up after you sold and before you bought back.
I'm not sure how long you have to wait (per IRS) to buy it back though. That's why I bumped into this question.
What else can I help you with?
Do wash sale rules apply to gains when selling stocks?
Yes, wash sale rules apply to gains when selling stocks. This means that if you sell a stock at a gain and then repurchase the same or substantially identical stock within 30 days, you may not be able to claim the gain for tax purposes.
What is the wash rule and how does it impact stock trading?
The wash rule is a regulation that prevents investors from claiming a tax deduction on a stock sale if they repurchase the same stock within 30 days. This rule impacts stock trading by discouraging investors from selling and repurchasing the same stock quickly in order to manipulate their tax liabilities.
Difference between a repo and stock loan?
A repo (repurchase agreement) is a short-term borrowing arrangement where one party sells securities to another with the agreement to repurchase them at a later date, typically to raise cash. In contrast, a stock loan involves borrowing shares of stock from a lender, usually for the purpose of short selling, with the borrower agreeing to return the shares at a later date. While repos are primarily used for liquidity and financing, stock loans focus on the transfer of ownership and the potential for short selling. Both agreements involve collateral, but their structures and purposes differ significantly.
What is the impact of a stock repurchase on a company's debt ratio?
Stock repurchases increases the debt equity ratio towards higher debt.
What is When selling your stock the broker will deduct before passing the money on to you?
that's a commission
What is a short cover in stock investing?
A short cover is a repurchase of any asset after selling it short, which means selling something you don't own at the moment to buy it back later at a lower price.
Why would a corporation repurchase its own stock?
A corporation might repurchase its own stock in order to invest in itself. This allows the company to retain ownership of itself.
Do wash sale rules apply to gains when selling stocks?
Yes, wash sale rules apply to gains when selling stocks. This means that if you sell a stock at a gain and then repurchase the same or substantially identical stock within 30 days, you may not be able to claim the gain for tax purposes.
Is the repurchase of stock reported on the equity statement?
no, i dont think so
What is the wash rule and how does it impact stock trading?
The wash rule is a regulation that prevents investors from claiming a tax deduction on a stock sale if they repurchase the same stock within 30 days. This rule impacts stock trading by discouraging investors from selling and repurchasing the same stock quickly in order to manipulate their tax liabilities.
Difference between a repo and stock loan?
A repo (repurchase agreement) is a short-term borrowing arrangement where one party sells securities to another with the agreement to repurchase them at a later date, typically to raise cash. In contrast, a stock loan involves borrowing shares of stock from a lender, usually for the purpose of short selling, with the borrower agreeing to return the shares at a later date. While repos are primarily used for liquidity and financing, stock loans focus on the transfer of ownership and the potential for short selling. Both agreements involve collateral, but their structures and purposes differ significantly.
What is a buyback?
A buyback is a repurchase of something previously sold, especially of stock by the company which issued it.
What is the impact of a stock repurchase on a company's debt ratio?
Stock repurchases increases the debt equity ratio towards higher debt.
What is it called when a company buys back its own stock?
It is called a stock repurchase and is posted to an account called Treasury Stock, a contra-account in the Equity section.
What is When selling your stock the broker will deduct before passing the money on to you?
that's a commission
Is it possible for me to sell a stock before the settlement date?
Yes, it is possible to sell a stock before the settlement date through a process known as "selling short." This involves borrowing the stock from a broker and selling it with the intention of buying it back at a later date to return to the broker.
What is A bet that a stock will fail?
A bet that a stock will fail is commonly referred to as "short selling." In this strategy, an investor borrows shares of the stock and sells them at the current market price, hoping to buy them back later at a lower price after the stock declines. If the stock does fall, the investor can repurchase the shares at the reduced price, return them to the lender, and pocket the difference. However, if the stock price rises instead, the investor faces potentially unlimited losses.
