Damn, I wish I knew someone who specialised in CGT, I've always found it interesting. My understanding of the situation is below. The relevance to WZR being that I had wondered about flipping it multiple times given that the charts showed it trading continuously in a consistent range.
Below 37k taxable income, he is at 19% tax. His CGT discount is then 9.5%. Buy selling and buying at a 16% lower price, he is getting a better discount than the CGT discount, hence he would be improving his NPAT.
However, once over 37k taxable income, he is at 32.5% tax. His CGT discount is now 16.25%, approximately equaling the discount he makes of selling at 17.5c and rebuying at 15c. Therefore there is no point in selling and rebuying at that discount, unless you can do it multiple times in a financial year.
Once over 90k taxable income, it gets even worse...
WZR Price at posting:
23.5¢ Sentiment: Hold Disclosure: Held
