2 ms·
I am not even close to the richest of the richest but I have done this before when I needed to use the cash but didn't want to trigger a capital gain from actua
by trollbridge 1y ago
I am not even close to the richest of the richest but I have done this before when I needed to use the cash but didn't want to trigger a capital gain from actually selling the stock.
It is a slightly more complex trade using both available margin and a stock option which effectively results in the "interest" showing up as a capital loss, and helped keep the risk minimal of actually being forced to sell. When the transaction was all done, then I sold enough of the stock to have a capital gain to offset the capital loss.
The purpose? Moving very quickly to buy a property which required 10% of the purchase price in cash on a specific day (buying property at auction). The auction house offered to "wait to deposit the cheque" until a Tuesday for an auction on a Saturday... which coincidentally is how many days it takes a cash-out transaction from a brokerage account to clear, after making the trades at market-open on a Monday morning. We showed the auction house the brokerage account and the trades (which they were not unfamiliar with) and they were quite agreeable to sit on the cheque until the funds cleared.
All entirely legal, and all why savvy 4's, most 5's, and every single 6 are able to use their wealth to acquire property whereas the 3's and below are perpetually mired in poverty, despite working very, very hard.