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Madness at the NSE
Rank: Veteran Joined: 11/15/2013 Posts: 1,977 Location: Here
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TheGeek wrote:Boris Boyka wrote:littledove wrote:Boris Boyka wrote:TheGeek wrote:Watching COOP bank if it will print 17.55 Mchawi wewe NKT!!! I held this share for around two years and it was all stress, it was dancing between 14 and 16 , I sold and vowed never to touch it again in near future, its sad its retreating to those levels again! Am begining to be emotional on this one! NKT! i just returned in this shit. wacha nione this week. nktesticles.. @boris I hope you calmed down and waited for this seesaw. I doubt 21 will be breached. @The geek yap i calmed down and am hoping to exit at my entry point as you said before hii edited yako.. Everybody STEALS, a THIEF is one who's CAUGHT stealing something of LITTLE VALUE. !!!
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Rank: Member Joined: 12/24/2008 Posts: 112
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@mlennyma - my financial adviser tells me that many of these trades are 'across the books' at heavily discounted broker commissions.
The buyer and seller in each trade is the same person, so that CGT when it arises will be calculated on these trades, hence there has been insignificant change in price despite the heavy volumes in turnover.
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Rank: Elder Joined: 2/26/2012 Posts: 15,980
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Quick question, Do you think that CGT will slow down selling hence making the price of some entities to go up? "There are only two emotions in the market, hope & fear. The problem is you hope when you should fear & fear when you should hope: - Jesse Livermore
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Rank: Elder Joined: 9/23/2009 Posts: 8,083 Location: Enk are Nyirobi
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murchr wrote:Quick question, Do you think that CGT will slow down selling hence making the price of some entities to go up? Prices are determined by demand and supply. If CGT kills supply, prices go up. If it kills demand, prices collapse. Life is short. Live passionately.
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Rank: Elder Joined: 9/23/2009 Posts: 8,083 Location: Enk are Nyirobi
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murchr wrote:Quick question, Do you think that CGT will slow down selling hence making the price of some entities to go up? Prices are determined by demand and supply. If CGT kills supply, prices go up. If it kills demand, prices collapse. We might have the latter, IMO. Life is short. Live passionately.
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Rank: Elder Joined: 6/23/2009 Posts: 13,706 Location: nairobi
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hii 5% si pesa mingi.. tutawalipa hawa watu wa serikali, wakule, wanone..
COOP 255,000 ABP 15.85; KQ 544,100 ABP 7.15; MTN 23,800 ABP 5.20
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Rank: Elder Joined: 2/26/2012 Posts: 15,980
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sparkly wrote:murchr wrote:Quick question, Do you think that CGT will slow down selling hence making the price of some entities to go up? Prices are determined by demand and supply. If CGT kills supply, prices go up. If it kills demand, prices collapse. We might have the latter, IMO. I tend to think people will hold. Liquidity will be costly "There are only two emotions in the market, hope & fear. The problem is you hope when you should fear & fear when you should hope: - Jesse Livermore
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Rank: Elder Joined: 7/21/2010 Posts: 6,187 Location: nairobi
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Let me hope that the CGT will not result to claims and claims of refunds resulting from poor calculations of a broke gvt taxing pples operating capital instead of gains. "Don't let the fear of losing be greater than the excitement of winning."
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Rank: Member Joined: 6/14/2010 Posts: 521 Location: Nairobi
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mlennyma wrote:Let me hope that the CGT will not result to claims and claims of refunds resulting from poor calculations of a broke gvt taxing pples operating capital instead of gains. Friday is the d-day. Let's see how they'll do it.
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Rank: Veteran Joined: 3/26/2012 Posts: 985 Location: Dar es salaam,Tanzania
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hisah wrote:murchr wrote:hisah wrote:December jumbo turnover madness...!!
Scom, kcb, eabl, centum, eqty, scan, pan africa, kenya re etc...
The next market move will be spectacular whether upside or downside. Get ready for serious madness if those two words can be in the same statement!!? Amazing you've not taken a break this year.  Too much going on from a global scale e.g. oil producers fat discounts/volatility, US equities awesome meltup, record IPOs everywhere, fx volatility coz of USD and NSE having the busiest Dec on record etc!?
Not conducive for a proper holiday mood 
@metaspoilt - check out nmg. I think the shift is suggesting long scangroup.
Thanks!I will be watching both for an explicit trend change.
“The pessimist complains about the wind; the optimist expects it to change; the realist adjusts the sails.”
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Rank: Veteran Joined: 3/26/2012 Posts: 985 Location: Dar es salaam,Tanzania
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murchr wrote:sparkly wrote:murchr wrote:Quick question, Do you think that CGT will slow down selling hence making the price of some entities to go up? Prices are determined by demand and supply. If CGT kills supply, prices go up. If it kills demand, prices collapse. We might have the latter, IMO. I tend to think people will hold. Liquidity will be costly I like your thinking Murchr,That is a possibility
“The pessimist complains about the wind; the optimist expects it to change; the realist adjusts the sails.”
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Rank: Member Joined: 1/25/2010 Posts: 344
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i totally disagree with the theory that people are selling stocks pre-CGT and buy them back post-CGT. doesn't make economic sense.
say u bought 10,000 shares of stock X at 50/=, current price is 100/=. if you sell that stock pre-CGT, cost incurred (brokerage fee) is say 2% of the revenue which is 10,000*100*0.02=10,000/=. If you decide to buy back the same shares post=CGT, you'll incur another 2% cost of brokerage of 10,000/=. total cost 20,000/=.
the other scenario is holding onto the shares and selling them post-CGT. costs incurred in this case will be the 10,000/= brokerage fee,plus 5% CGT. profit will be (10,000*100/=)minus(10,000*50/=)=50,000/= less brokerage fee of 10,000/=,net profit of 40,000/=.CGT will be 0.05*40,000=2,000/=. total cost incurred 12,000/= compared to 20,000/= above. also please note that i have not deducted the brokerage fee for buying the shares which should further reduce the taxable profit
#my2cents
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Rank: Veteran Joined: 2/10/2010 Posts: 1,001 Location: River Road
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theking wrote:i totally disagree with the theory that people are selling stocks pre-CGT and buy them back post-CGT. doesn't make economic sense.
say u bought 10,000 shares of stock X at 50/=, current price is 100/=. if you sell that stock pre-CGT, cost incurred (brokerage fee) is say 2% of the revenue which is 10,000*100*0.02=10,000/=. If you decide to buy back the same shares post=CGT, you'll incur another 2% cost of brokerage of 10,000/=. total cost 20,000/=.
the other scenario is holding onto the shares and selling them post-CGT. costs incurred in this case will be the 10,000/= brokerage fee,plus 5% CGT. profit will be (10,000*100/=)minus(10,000*50/=)=50,000/= less brokerage fee of 10,000/=,net profit of 40,000/=.CGT will be 0.05*40,000=2,000/=. total cost incurred 12,000/= compared to 20,000/= above. also please note that i have not deducted the brokerage fee for buying the shares which should further reduce the taxable profit
#my2cents The theory is that if you bought your shares in the 1990's when they were dirt cheap CGT uses the year of purchase as the base year to calculate the 5% capital gains. It is much easier to sell and buy back to make 2014 your base year for CGT
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Rank: Member Joined: 1/25/2010 Posts: 344
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mkonomtupu wrote:theking wrote:i totally disagree with the theory that people are selling stocks pre-CGT and buy them back post-CGT. doesn't make economic sense.
say u bought 10,000 shares of stock X at 50/=, current price is 100/=. if you sell that stock pre-CGT, cost incurred (brokerage fee) is say 2% of the revenue which is 10,000*100*0.02=10,000/=. If you decide to buy back the same shares post=CGT, you'll incur another 2% cost of brokerage of 10,000/=. total cost 20,000/=.
the other scenario is holding onto the shares and selling them post-CGT. costs incurred in this case will be the 10,000/= brokerage fee,plus 5% CGT. profit will be (10,000*100/=)minus(10,000*50/=)=50,000/= less brokerage fee of 10,000/=,net profit of 40,000/=.CGT will be 0.05*40,000=2,000/=. total cost incurred 12,000/= compared to 20,000/= above. also please note that i have not deducted the brokerage fee for buying the shares which should further reduce the taxable profit
#my2cents The theory is that if you bought your shares in the 1990's when they were dirt cheap CGT uses the year of purchase as the base year to calculate the 5% capital gains. It is much easier to sell and buy back to make 2014 your base year for CGT it'll still be more expensive to sell and buy back even if the shares were free. do the math
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Rank: Elder Joined: 9/23/2009 Posts: 8,083 Location: Enk are Nyirobi
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theking wrote:mkonomtupu wrote:theking wrote:i totally disagree with the theory that people are selling stocks pre-CGT and buy them back post-CGT. doesn't make economic sense.
say u bought 10,000 shares of stock X at 50/=, current price is 100/=. if you sell that stock pre-CGT, cost incurred (brokerage fee) is say 2% of the revenue which is 10,000*100*0.02=10,000/=. If you decide to buy back the same shares post=CGT, you'll incur another 2% cost of brokerage of 10,000/=. total cost 20,000/=.
the other scenario is holding onto the shares and selling them post-CGT. costs incurred in this case will be the 10,000/= brokerage fee,plus 5% CGT. profit will be (10,000*100/=)minus(10,000*50/=)=50,000/= less brokerage fee of 10,000/=,net profit of 40,000/=.CGT will be 0.05*40,000=2,000/=. total cost incurred 12,000/= compared to 20,000/= above. also please note that i have not deducted the brokerage fee for buying the shares which should further reduce the taxable profit
#my2cents The theory is that if you bought your shares in the 1990's when they were dirt cheap CGT uses the year of purchase as the base year to calculate the 5% capital gains. It is much easier to sell and buy back to make 2014 your base year for CGT it'll still be more expensive to sell and buy back even if the shares were free. do the math Sell to another company that you own. The second company will still be able to deduct brokerage paid. Bear in mind that CGT applies for longterm purchases. Life is short. Live passionately.
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Rank: Elder Joined: 9/23/2009 Posts: 8,083 Location: Enk are Nyirobi
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theking wrote:i totally disagree with the theory that people are selling stocks pre-CGT and buy them back post-CGT. doesn't make economic sense.
say u bought 10,000 shares of stock X at 50/=, current price is 100/=. if you sell that stock pre-CGT, cost incurred (brokerage fee) is say 2% of the revenue which is 10,000*100*0.02=10,000/=. If you decide to buy back the same shares post=CGT, you'll incur another 2% cost of brokerage of 10,000/=. total cost 20,000/=.
the other scenario is holding onto the shares and selling them post-CGT. costs incurred in this case will be the 10,000/= brokerage fee,plus 5% CGT. profit will be (10,000*100/=)minus(10,000*50/=)=50,000/= less brokerage fee of 10,000/=,net profit of 40,000/=.CGT will be 0.05*40,000=2,000/=. total cost incurred 12,000/= compared to 20,000/= above. also please note that i have not deducted the brokerage fee for buying the shares which should further reduce the taxable profit
#my2cents Think simple. If you sell pre CGT, CGT=0. If you sell post CGT, CGT= 25,000. Brokerage paid is a recoverable cost while CGT isn't. Life is short. Live passionately.
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Rank: Veteran Joined: 6/23/2011 Posts: 1,740 Location: Nairobi
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I totally agree with you.
When one sells to avoid CGT the implication is that they can tell what will happen to the share in 2015 i.e. become cheaper. In which case you sell any way and buy in 2015.
CGT is just an excuse and simplicity in analysis in the selling behaviour.
One needs to compare what happens each end of year and then a trend may appear
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Rank: Member Joined: 1/25/2010 Posts: 344
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sparkly wrote:theking wrote:i totally disagree with the theory that people are selling stocks pre-CGT and buy them back post-CGT. doesn't make economic sense.
say u bought 10,000 shares of stock X at 50/=, current price is 100/=. if you sell that stock pre-CGT, cost incurred (brokerage fee) is say 2% of the revenue which is 10,000*100*0.02=10,000/=. If you decide to buy back the same shares post=CGT, you'll incur another 2% cost of brokerage of 10,000/=. total cost 20,000/=.
the other scenario is holding onto the shares and selling them post-CGT. costs incurred in this case will be the 10,000/= brokerage fee,plus 5% CGT. profit will be (10,000*100/=)minus(10,000*50/=)=50,000/= less brokerage fee of 10,000/=,net profit of 40,000/=.CGT will be 0.05*40,000=2,000/=. total cost incurred 12,000/= compared to 20,000/= above. also please note that i have not deducted the brokerage fee for buying the shares which should further reduce the taxable profit
#my2cents Think simple. If you sell pre CGT, CGT=0. If you sell post CGT, CGT= 25,000. Brokerage paid is a recoverable cost while CGT isn't. my point is not selling, my point is selling to buy back, doesn't make economic sense even if BP is 0
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Rank: Member Joined: 6/14/2010 Posts: 521 Location: Nairobi
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theking wrote:mkonomtupu wrote:theking wrote:i totally disagree with the theory that people are selling stocks pre-CGT and buy them back post-CGT. doesn't make economic sense.
say u bought 10,000 shares of stock X at 50/=, current price is 100/=. if you sell that stock pre-CGT, cost incurred (brokerage fee) is say 2% of the revenue which is 10,000*100*0.02=10,000/=. If you decide to buy back the same shares post=CGT, you'll incur another 2% cost of brokerage of 10,000/=. total cost 20,000/=.
the other scenario is holding onto the shares and selling them post-CGT. costs incurred in this case will be the 10,000/= brokerage fee,plus 5% CGT. profit will be (10,000*100/=)minus(10,000*50/=)=50,000/= less brokerage fee of 10,000/=,net profit of 40,000/=.CGT will be 0.05*40,000=2,000/=. total cost incurred 12,000/= compared to 20,000/= above. also please note that i have not deducted the brokerage fee for buying the shares which should further reduce the taxable profit
#my2cents The theory is that if you bought your shares in the 1990's when they were dirt cheap CGT uses the year of purchase as the base year to calculate the 5% capital gains. It is much easier to sell and buy back to make 2014 your base year for CGT it'll still be more expensive to sell and buy back even if the shares were free. do the math I think MkonoMtupu's theory makes sense. If I bought shares back in the 90s at those rock bottom prices, I'd simply sell and buy back pre-CGT.
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Rank: Elder Joined: 7/22/2009 Posts: 7,535
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The optimist wrote:theking wrote:mkonomtupu wrote:theking wrote:i totally disagree with the theory that people are selling stocks pre-CGT and buy them back post-CGT. doesn't make economic sense.
say u bought 10,000 shares of stock X at 50/=, current price is 100/=. if you sell that stock pre-CGT, cost incurred (brokerage fee) is say 2% of the revenue which is 10,000*100*0.02=10,000/=. If you decide to buy back the same shares post=CGT, you'll incur another 2% cost of brokerage of 10,000/=. total cost 20,000/=.
the other scenario is holding onto the shares and selling them post-CGT. costs incurred in this case will be the 10,000/= brokerage fee,plus 5% CGT. profit will be (10,000*100/=)minus(10,000*50/=)=50,000/= less brokerage fee of 10,000/=,net profit of 40,000/=.CGT will be 0.05*40,000=2,000/=. total cost incurred 12,000/= compared to 20,000/= above. also please note that i have not deducted the brokerage fee for buying the shares which should further reduce the taxable profit
#my2cents The theory is that if you bought your shares in the 1990's when they were dirt cheap CGT uses the year of purchase as the base year to calculate the 5% capital gains. It is much easier to sell and buy back to make 2014 your base year for CGT it'll still be more expensive to sell and buy back even if the shares were free. do the math I think MkonoMtupu's theory makes sense. If I bought shares back in the 90s at those rock bottom prices, I'd simply sell and buy back pre-CGT. Is the CGT being back dated? I doubt! How do you tax gains that were made before the tax was operational. That would not make sense and would be grounds for numerous court cases. But this is Kenya. anything is possible and people in certain offices are bloody lazy!!! Have they decided on the base year in any case? Last I heard, brokers were saying they didn't have records on when shares were bought and at how much! Never count on making a good sale. Have the purchase price be so attractive that even a mediocre sale gives good returns.
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