The AIB thread


#2064

Are profits made from spread betting on shares, tax free?


#2065

Generally, but not if it’s your main source of income.


#2066

Really?

Do you have any evidence or is that just speculation on your part?


#2067

Well, the fact that many of them go bust when weird things (anything outside their rather limited models) happen should be evidence enough for you.
thisismoney.co.uk/money/news … nings.html

poundsterlinglive.com/excha … ank-543543


#2068

Irish/UK regulators require spread betting firms to have matching strategy in place in prevent client losses.

Yes there have been a couple examples of firms failing in this regard but the blank statement that firms don’t match their exposures is wrong.


#2069

if they had massive exposure one way I’d expect them to hedge - but like Paddy Power etc they’re usually taking bets both ways - not everyone is a permabull!! i.e. it’s about managing the book rather than individual bets

CFD providers are different


#2070

If they had been hedged, client losses would not have bust them. Clearly they were not hedged, or not hedged enough which is the same thing as being a little bit pregnant…


#2071

irishtimes.com/business/fina … -1.2419586

AIB to repay €1.7 billion


#2072

Astonishing. The government is giving us a fantastic opportunity to buy shares in a bank that we’ve already paid for. Having said that though, they will almost certainly be a good vote buying investment.


#2073

Whodathunkit that the 0.7% free float of AIB led to a false market in the shares…

rte.ie/news/business/2015/11 … ib-shares/


#2074

But it’s safe as houses!


#2075

A valuation of €11.7bn is basically where AIB was at after the dot-com crash when Rusnak lost a fortune for the bank. That’s a sensible (probably even cheap) valuation considering things. I reckon if you bought shares and locked them away in a drawer for 10 years, you’d probably end up doubling your money and have a nice source of dividends.


#2076

It’s quite incredible that there are still people buying shares at 4c today! Extraordinary that someone would buy shares in a company when they have been told many times for several years that it is grossly overvalued and now the national media is full of stories of how the share price will imminently convert to less than 2c. The mind boggles.


#2077

Is it any more surprising that people held onto these shares for years and didn’t liquidate to drive the price down to a realistic level?


#2078

the time Noonan came out and said - “hey lads, is a false market” the Freeman types were accusing him of driving down the price so the usual suspect could buy it up on the cheap


#2079

you couldn’t short it, so you lost that element of the balance;
I think a lot of the buying was index funds and the like which have to track the ISEQ so they would end up buying at whatever price, the individual valuation allowing no discretion


#2080

hahaha! I didn’t know that, what a bunch of knobs.


#2081

I know of some people who owned AIB shares and didn’t sell them as part of tax planning - what they get for selling them is small


#2082

I don’t think any index funds would own AIB shares now. I certainly can’t think of any that would. And legacy owners holding onto shares due to inertia wouldn’t in itself be supportive of the price unless they were actively out buying more in the market.

I’m afraid that the more likely answer is punters throwing their money around buying shares in a company in complete ignorance of its value. Given that the AIB restructuring process has been one of the top three business stories in the country over the past couple of days, that takes some doing.

I’m not sure why I am surprised that some people do silly things with their money, but this just seems so stupid that it’s hard to get my head around it.


#2083

Sold this year to write off the loss against a gain. Losses carry forward indefinitely, so no reason to hold as far as I am aware.

EDIT: Although, given the sale price achieved. There wasn’t much risk on the downside of holding. And it’s not like the proceeds were badly needed, might have paid for a meal for two.