KDRO, page-49

No, that's not correct about the tax treatment. Each holding, and arguably each parcel of shares, can and should be assessed individually to determine whether you bought it with future dividends and growth in mind (for it to produce assessable income for you) or if you bought it as trading stock (to produce assessable income from buying and selling).

If you buy it for it to produce assessable income, it is going to be considered capital, and the CGT discounts apply after 12 months. If you buy it with the intention to sell for a profit, it is trading stock and the CGT discounts won't apply.

It is possible to pursue both strategies in the market at the same time, and even with the same stock at the same time, without issue. You will need to be more rigorous in terms of documentation, or you may find yourself having everything classified as trading stock. It might be worthwhile to make notes about your strategy as you buy and sell, to show to your accountant and possibly to an auditor, if that were to come up. The distinction comes down to intention and motivation, after all, so notes might be handy.

A long-term and a short-term account is a common way of separating the two for simplicity. I don't know how well it works in an audit, but I have seen many posters using it, and I can see the logic.

If you're unsure, speak to an accountant about it.

Agree with your comments about people selling heads to exercise the options. Add on a lack of news and general market sentiment, and here we are with a low-volume dip.