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Home Capital Group Inc T.HCG

Home Capital Group Inc. is a Canada-based holding company that operates through its principal subsidiary, Home Trust Company (Home Trust). Home Trust is a federally regulated trust company offering residential and non-residential mortgage lending, securitization of residential mortgage products, consumer lending and credit card services. In addition, Home Trust and its wholly owned subsidiary, Home Bank offer deposits through brokers and financial planners, and through a direct-to-consumer brand, Oaken Financial. Its mortgage lending includes classic single-family residential lending, insured residential lending, residential commercial lending, and non-residential commercial lending. Its consumer lending loan portfolio comprises credit cards, lines of credit and other consumer retail loans. In addition, the Company manages a treasury portfolio to support liquidity requirements and invest excess capital.


TSX:HCG - Post by User

Post by canaderon Dec 15, 2021 10:43am
195 Views
Post# 34232615

The SIB can work in cash account, but not ideal.

The SIB can work in cash account, but not ideal.


So the way they do this thing you end up getting most of the money, as a dividend, and a few bucks worth as return of capital. So you get a significant capital loss per share that you sell in the cash account. Its all accounting magic and a BS tax trap for the uninformed.

But If you have a bunch of capital gains that you can offset the capital loss against it kinda evens itself out.

But you still end up paying dividend tax rate, instead of capital tax rate on most of the "Purchase Price"

So could be the selling pressure over the last month has been some big boys selling some in the cash account to bring up thier captial gains to apply against the capital loss. Who knows.
I am not a cricket these days, but not interested in the gymnastics needed to do the SIB in a cash account. But it is doable.

This SIB thing sucks for the uninformed retail investor that sells shares into the SIB not knowing the tax consequences or how to mitigate against the tax consequences.

So retail dudes, If you don't know the tax consequences of this in a cash account, DON'T DO IT.

Only in RRSP, or TFSA.

GLTA, cept the dhorties of course!






 

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