New Tax on All Stock Trades

[volpunter]

What? that is bollocks. There are tons of hedge funds that trade European cash equity and are subject to full stamp duty payments. What the heck are you talking about? I have knowledge and can present facts of my claims, those are not opinions. The same applies to equity trading in Hong Kong. There are tons of "day traders" and there are tons of professional hedge fund prop traders in Hong Kong alone. I know of several buddies in the market who enter positions some time in the AM session and exit hours later, aiming for >100 basis point returns and happily (well not happily) pay their stamp on each trade. You do not seem to know what you are talking about. And we do not talk turnover of once a year. Unless you literally churn your account this fee should not tilt the scale between profitability and unprofitability.

And I do not care how you define prop shops because prop shops were never the issue here. Fact is even in the worst case such fee, let's assume its 10 basis points, won't hardly affect anyone trading lower frequencies. Should I cry a river now that some American "prop shop traders" (in my jurisdiction they are called coffee stained tshirt wearing losers btw) will need to find a different career path or need to adapt? No , I wont. I had to adapt many times in my career so whats the challenge here? Are you unable to adapt to change?

there are no stock prop shops trading UK equities in the UK because of the stamp tax. some people have opinions and will deny the statistical facts. you cannot day trade stocks successfully with a stamp tax. if your turnover is once a year you may make a profit. these are investors not traders. in the US turning over their capital once a day is not unusual.

your post is just one of many, particularly on of subject of transaction taxes,which are the result of denial of reality. study the numbers and the reality before make prima facie nonsensical statements.

 

[luisHK]

There are tons of hedge funds that trade UK cash equities ?
Even for french equities at 0.2% transaction tax, I suspect most funds do the same calculation I do. They try to anticipate their holding period, commissions and interests and trade dma CFDs rather than underlying stocks if it's cheaper or other untaxed derivatives.
I sure prefer trading on markets without transaction tax, and it's ludicrous to say the transaction tax will only affect losers. But we know who posted those insults ...
UK and french transaction tax is a Bonanza for the brokers btw, who make much more money on those than on equities (if their customers trade large lots at least or have enough cash available not to buy on margin).
I'm curious about Italy's situation on the long term, as they seem to tax cfds the same as the underlying (IB doesn't allow new CFDs positions to be open on italian markets). For those interested in the Italian market, you might check the options there, 500 share lots and much lower transaction tax than the underlying (if you don't exercise or get assigned).

 

[luisHK]

BTW from what I understood, France exempts market makers but also day traders. Not sure about Italy (I seldom enter and exit a position the same day)

 

[luisHK]

About HK market beeing popular with active traders :

"To support its unsuccessful attempt to list in Hong Kong, Chinese internet retail giant Alibaba argued that the city's share of Asian stock market trading was in severe decline.

A high-profile initial public offering from a big technology company, insisted Alibaba executives, was just what the Hong Kong stock exchange needed to revitalise its flagging market.

It is true that trading activity in Hong Kong-listed shares is relatively limp by regional standards.

In the first nine months of this year, Hong Kong's average market velocity - the value of shares traded each month as a proportion of total market capitalisation - was just 44 per cent.

As the first chart shows, that's the lowest among East Asia's major stock markets. In contrast, Japan's market velocity is almost four times as great at a blistering 161 per cent."

http://www.scmp.com/business/bankin...ong-should-scrap-its-stamp-duty-share-trading

 

[zdreg]

What? that is bollocks. There are tons of hedge funds that trade European cash equity and are subject to full stamp duty payments. What the heck are you talking about? I have knowledge and can present facts of my claims, those are not opinions. The same applies to equity trading in Hong Kong. There are tons of "day traders" and there are tons of professional hedge fund prop traders in Hong Kong alone. I know of several buddies in the market who enter positions some time in the AM session and exit hours later, aiming for >100 basis point returns and happily (well not happily) pay their stamp on each trade. You do not seem to know what you are talking about. And we do not talk turnover of once a year. Unless you literally churn your account this fee should not tilt the scale between profitability and unprofitability.

And I do not care how you define prop shops because prop shops were never the issue here. Fact is even in the worst case such fee, let's assume its 10 basis points, won't hardly affect anyone trading lower frequencies. Should I cry a river now that some American "prop shop traders" (in my jurisdiction they are called coffee stained tshirt wearing losers btw) will need to find a different career path or need to adapt? No , I wont. I had to adapt many times in my career so whats the challenge here? Are you unable to adapt to change?

 

[zdreg]

"There are tons of "day traders" and there are tons of professional hedge fund prop traders in Hong Kong alone."
do the numbers and stop your anecdotes. they are meaningless. those traders you mention in
hongkong , if they exist are the equivalent of day traders and it is impossible mathematically
to be succesful but the people you claim to know are all outliers, no doubt.

 

[d08]

there are no stock prop shops trading UK equities in the UK because of the stamp tax. some people have opinions and will deny the statistical facts. you cannot day trade stocks successfully with a stamp tax. if your turnover is once a year you may make a profit. these are investors not traders. in the US traders turning over their capital once a day is not unusual.

your post is just one of many, particularly on of subject of transaction taxes,which are the result of denial of reality. study the numbers and the reality before make prima facie nonsensical statements.

Everyone in UK trades CFDs which for the retail investor is the same as trading stocks, no stamp tax and from what I understand, cap gains tax free.

 

[d08]

BTW from what I understood, France exempts market makers but also day traders. Not sure about Italy (I seldom enter and exit a position the same day)

In France daytrades are exempt, not so in Italy.

 

[volpunter]

Please don't twist what I Said:

A) London Houses several hundred hedge funds that trade pure cash equity and while A lot if funds hold such positions for longer period of times there are many shops that employ equity traders who turn over equities relatively frequently.

B) I never said the tax only affects losers. Read again. In fact I said it affects everyone. But smart traders adjust alongside changing regulations. When I referred to losers then it is some punters sitting with dirty tshirts in some shitty office and moan all day how the old days are gone and how HFT destroyed their lives and now they bitch how a stock transaction tax is gonna be the end of the world. Those are the people who never managed to acquire the skills to work in a professional environment and were too lazy to adjust to changing Market dynamics and regulatory environment.

C) any costs if hedging and therefore any future or already existing transaction costs are fully priced into CFDs. How else do you reckon the houses to hedge their exposure? So saying CFDS are a way around us ludicrous. It reflects you don't understand the basics of CFD pricing.

There are tons of hedge funds that trade UK cash equities ?
Even for french equities at 0.2% transaction tax, I suspect most funds do the same calculation I do. They try to anticipate their holding period, commissions and interests and trade dma CFDs rather than underlying stocks if it's cheaper or other untaxed derivatives.
I sure prefer trading on markets without transaction tax, and it's ludicrous to say the transaction tax will only affect losers. But we know who posted those insults ...
UK and french transaction tax is a Bonanza for the brokers btw, who make much more money on those than on equities (if their customers trade large lots at least or have enough cash available not to buy on margin).
I'm curious about Italy's situation on the long term, as they seem to tax cfds the same as the underlying (IB doesn't allow new CFDs positions to be open on italian markets). For those interested in the Italian market, you might check the options there, 500 share lots and much lower transaction tax than the underlying (if you don't exercise or get assigned).

 

[clacy]

Zero percent chance something like this can take hold with Republicans in control of both houses.

The time to worry would be if Elizabeth Warren were to win the Presidency and the Senate flipped to the Dems in 2016.

As of now, I don't think it's even remotely likely, but certainly worth speaking out against since that can't hurt anything.