If Biden wins, is a Stock Transaction Tax likely?

[Jjmboni]

Any "elite trader" who will vote for Biden is a classic hypocrite in my book. Right under our nose.

Classic hypocrite here!

The amount of FUD on this thread is HILARIOUS! You conservatives will be clutching your guns and your money off rocking in a corner if Biden wins! Meanwhile I'm gonna add to my gun collection. I bought a nice Chinese SKS short barrel Assault Rifle during the Clinton era (when he was trying to take your guns). I didn't buy anything during the Obama era, but I did but a nice magazine extender for my Remington 870 (when he was trying to take your guns). I think this time I'll buy a nice AR-15 kit (when Biden is taking your guns). I'll probably use my TSLA profits to buy it...

 

[SammyJ]

It’s 100% coming. 60 million people are some type of govt help . Biden will print $5 trillion min next yr . I suspect huge tax increase increases on the well to do

 

[Sig]

It’s 100% coming. 60 million people are some type of govt help . Biden will print $5 trillion min next yr . I suspect huge tax increase increases on the well to do

I'm not sure what the number of people on government assistance has to do with an FTT? We spent a little over $200B a year on the programs that those 60 million people use. We spend just under $700B on the defense budget. So why would you choose to say that the government assistance budget is what's driving the need for tax increases, rather than, say the line item that uses up 3.5 times more of the budget?
Also not clear how the President, whoever it ends up being, "prints $5 trillion"? Perhaps you're thinking about the budget deficit, which ballooned to $3.3T in FY 2020 up from $587B when Trump took office entirely due to his ill advised tax cuts. We can all certainly hope that Biden actually cares about deficits since Republicans clearly do not, and that will mean at least a repeal of the Trump tax cuts if not some of the GW cuts. But none of that points to an FTT.

 

[guowei58]

He's on record supporting a financial transaction tax, also if he wins it's highly likely VP Harris takes over at some point since Biden is in cognitive decline and she's pushing a 0.20% tax on stocks which will effectively destroy all retail day/swing traders, and of course Wall Street and HFTs will get exemptions.

What are the chances they get this transaction tax on the little guy done?

there's always ways to make money in the market. Transaction tax means illiquidity, which means bigger spreads...which is great for some trading strategies...my guess is that you'll find new ways to make money

 

[virtusa]

First result is in:

 

[Real Money]

Wouldn't options become much more attractive since the notional value of an option is much smaller than an outright position in the underlying unless deep ITM or for long dated?

The dollar volatility of an option is much higher as a percent of the transactional value of the contract than for futures (short term and ATM), or am I wrong about that?

The FTT would tax the notional value, and since options are basically durational price spreads, its like getting more exposure with less notional, or transactional value.

 

[d08]

FTT is certainly the greatest threat to anyone involved in trading. If they instituted it for all participants it would eliminate most of the HFT and trader volume leading to large spreads and terrible fills for retirements/pensions/longterm investors. If they exempt HFT/market makers then it really would just be a regressive tax on smaller traders. Either way it would be extremely devastating for retail trading. If the retail brokers were smart they would form some kind of coalition as soon as possible to lobby strongly against any FTT.

For me, I'd stop trading almost all strategies immediately. In some cases it would amount to ~80% profit reduction, making trading nonviable. Alternative would be CFDs but they have their own issues in execution.

If they want to kill trading in US then so be it. But many jobs will be lost due to this. I hope exchanges have plan B in place that includes moving operations out of US.

 

[newwurldmn]

For me, I'd stop trading almost all strategies immediately. In some cases it would amount to ~80% profit reduction, making trading nonviable. Alternative would be CFDs but they have their own issues in execution.

If they want to kill trading in US then so be it. But many jobs will be lost due to this. I hope exchanges have plan B in place that includes moving operations out of US.

is that how small your edge is per notional?

not a political statement or intended as an insult.

When I first started as a quant, I developed a strategy that earned 4bps/day per gross notional on average. The stat arb team make like 30mm/year trading it.

 

[d08]

is that how small your edge is per notional?

not a political statement or intended as an insult.

When I first started as a quant, I developed a strategy that earned 4bps/day per gross notional on average. The stat arb team make like 30mm/year trading it.

I have strategies that do better but those aren't my main ones. I have to look at the numbers again but it's between 50 to 80% loss assuming 0.40% FTT tax per roundtrip.

 

[gkishot]

is that how small your edge is per notional?

not a political statement or intended as an insult.

When I first started as a quant, I developed a strategy that earned 4bps/day per gross notional on average. The stat arb team make like 30mm/year trading it.

Where is it, forex?