Share Dealing Discussion Area

Originally posted by tradetime
if it is to derive income from short term trading the ISA's are dross

Would a Stocks and Shares ISA still be dross (in your opinion) if used to derive income over the long term?

Originally posted by tradetime
The OP sounds like he wants t try and make income, that's difficult under any circumstance

Really? - are yields not at record highs at the minute? (assuming you can trust a fund manager to pick companies who can still pay these dividends!) How hard would it be to build an income portfolio of stocks and shares (in your opinion) at the moment?

Originally posted by tradetime
better to start outside an ISA and move it in if it works

Really? What if you started outside an ISA in this tax year (08/09) (investing 3,600) and continued in the May (tax year 09/10) (investing 3,800) with the aim of building an income portfolio. Could you Then move this into an ISA wrapper? - YES? because you are moving in last years ISA as well as this years ISA allowance.

Further i have another question.

This has not been mentioned in this thread so far ( i read all 29 pages) (phew), but would a big advantage of a Stocks and Shares ISA be the reduction in Income tax payable on Dividends, from 40% to 20%??

e.g. if i received 80 pounds of dividends outside my ISA wrapper i would need to decare this as a top rate tax payer, and hence have to pay a further 20 pounds to HMRC/Inland revenue

Whereas if i received 80 pounds of dividends inside my ISA wrapper i would not have to pay, any more tax to HMRC/Inland revenue, even if i am a top rate tax payer?

Is this correct?

Many thanks, trade time biggles and especially Sabre tooth tiger for all your input on this thread so far.

Many thanks for any replies.

tightasabulls wrote: »

Would a Stocks and Shares ISA still be dross (in your opinion) if used to derive income over the long term?

No, not necessarily, long term negates the cost of trades so no, the metric would change.

tightasabulls wrote: »

Really? - are yields not at record highs at the minute? (assuming you can trust a fund manager to pick companies who can still pay these dividends!) How hard would it be to build an income portfolio of stocks and shares (in your opinion) at the moment?

Don't know mate, I'm primarily a trader, not an investor, (though I do hold some longer term positions currently) but to answer your first question, yes, yields are pretty high at the moment, if you can trust them to be maintained. In any case, you quote is out of context, you need to refer to the OP's post, he doesn't sound like he's after yields, he's talking about trading 3 times a week

would in your opinion buying and selling about 3 times a week

there are folks on here who are knowledgeable about funds, I am not one of them, so I will defer to one of them to answer the rest of that question

tightasabulls wrote: »

Really? What if you started outside an ISA in this tax year (08/09) (investing 3,600) and continued in the May (tax year 09/10) (investing 3,800) with the aim of building an income portfolio. Could you Then move this into an ISA wrapper? - YES? because you are moving in last years ISA as well as this years ISA allowance.

No you can't do that, my suggestion was that he experiment with his trading activities outside an ISA, and if successful, possibly move his trading activities to an ISA (though I'm not sure this is cost effective, but will be happy to be proved wrong), not his funds or stock positions (though since he talks about buying and selling in the short term he won't have any of those) Stocks & Shares ISA allows for £7,200 currently, to be placed inside per year (assuming you don't put anything in a cash ISA in those years) Much like a cash ISA afaik your funds must be put in year by year respecting the limit, and must remain inside to keep the benefit.

tightasabulls wrote: »

Further i have another question.

This has not been mentioned in this thread so far ( i read all 29 pages) (phew), but would a big advantage of a Stocks and Shares ISA be the reduction in Income tax payable on Dividends, from 40% to 20%??

e.g. if i received 80 pounds of dividends outside my ISA wrapper i would need to decare this as a top rate tax payer, and hence have to pay a further 20 pounds to HMRC/Inland revenue

Whereas if i received 80 pounds of dividends inside my ISA wrapper i would not have to pay, any more tax to HMRC/Inland revenue, even if i am a top rate tax payer?

Is this correct?

Many thanks, trade time biggles and especially Sabre tooth tiger for all your input on this thread so far.

Many thanks for any replies.

Sorry, not sure what the treatment of dividends is in an ISA, so again I will defer.

tradetime wrote: »

OK let me explain, (re-read the quote you selected) I'm not talking about price of a normal account with a broker v the price of an SS ISA with the same broker, simply the best price you can get to achieve the OP's objective, the OP wants to trade 3x per week that's 6x trades per week over 300x per year, I'm assuming here, he wants to trade stock, not funds or anything else exotic, pick your ISA and give me the cost for 300 trades (forget stamp duty etc will be the same broker to broker). You're shooting for £1,800

OK, so you're not comparing SS ISAs with the broker's dealing a/c.

But, AFAICS, you haven't actually explained what you are comparing SS ISAs with. Care to enlighten us?

Biggles wrote: »

OK, so you're not comparing SS ISAs with the broker's dealing a/c.

But, AFAICS, you haven't actually explained what you are comparing SS ISAs with. Care to enlighten us?

Sorry, I was simply comparing brokers, (it just so happens the firms who offer S&S ISA's tend to fall into one group), with reference to what the OP wanted to do, namely

Unfortunately as previously predicted,today i am starting a 30 day consultation at work,and to be honest,things dont look all that good. would in your opinion buying and selling about 3 times a week

and suggesting that if he is going to conduct 3 or more round trips a week (300 trades per year) ISA accounts aren't suitable from what I've seen. An example being, that I just opened a S&S ISA with TD Waterhouse, and when I logged on I was transported back to the stoneage..

Biggles wrote: »

It's true that, even on 'frequent trader' commission levels, a round trip will cost you £12 or more plus the spread and stamp duty etc.

But the ones, like Barclays, Selftrade etc, that offer the cheapest frequent trader deals also offer SS ISAs with the same trading costs (but no CGT).

There's always spread betting and CFDs but the spread will usually cost you even more, especially when you get into serious money.

Interesting TD Waterhouse offers £9.95 each way to it's frequent traders, that's £19.90 round trip, I was not aware that Selftrade were so substantially cheaper in their ISA. I don't bother much with UK stock, but I believe Interactive do them for £6 per side if the trade is under £50,000, but they don't do ISA's. CFD's I know almost nothing about, so couldn't comment. Spreadbetting, I don't know much more, though I agree when you cost the spread it is pricey, but the tax advantage should more than make up for that if they don't obstruct you