Just a quick follow up on my franking credit post.
I'm a stats man so I thought I would challenge myself with a mental exercise about the "45-day rule" and the under $5,000 franking credit rule loophole to determine how many PLS shares you could buy the day after the dividend announcement and sell after the ex-div date to obtain franking credits.
Assumptions for this exercise. * On the Friday 25th PLS announces a 20c fully franked dividend with the Ex-div date on Friday (5 TD's Later) 1st Sept. * So at some time following the 25th but before 1 Sep you can buy 58,000 PLS shares. If you hold them past the Ex-div date then you can sell them and still receive $11,600 dividend and $4972 franked credits. If you hold in your super no CGT. "45-day rule" doesn't apply as the franked dividend is less than $5,000 and you fit the loophole.
59,000 shares and bye-bye franking credits.
This scenario changes according to the dividend. More than 20c div less shares, less than 20c div more shares. Get the drift. However your dividend can't exceed $11,600.
cheers Lies
PLS Price at posting:
$5.11 Sentiment: Buy Disclosure: Held
(20min delay)