Need Stock Trading Information

[funkyman]

I'm trying this forum for the first time. It seemed like a good idea with the large diversity of people here.
I just recently started doing some online trading with Ameritrade. I done went and messed up, and bought some stock that's actually doing something. When I sell it, what will the ramifications be tax wise? Will I get a 1099 from Ameritrade at the beginning of next year? How much will I loose in Taxation.
Any advice or help with this would be greatly appreciated.

Thanx and regards.......Jim.

 

[floorguy]

Originally Posted by funkyman
I'm trying this forum for the first time. It seemed like a good idea with the large diversity of people here.
I just recently started doing some online trading with Ameritrade. I done went and messed up, and bought some stock that's actually doing something. When I sell it, what will the ramifications be tax wise? Will I get a 1099 from Ameritrade at the beginning of next year? How much will I loose in Taxation.
Any advice or help with this would be greatly appreciated.

Thanx and regards.......Jim.
you will not have to pay taxes till you sell it, and at the end of the year you will receive a tax statement from ameritrade. I try to keep 25% of my earnings in the account to pay taxes at end of the year. Good luck.

 

[tangman99]

If you hold it short, it will be taxed as regular income. If you hold it long, it will be taxed at 15%. I always buy and sell short except for my retirement portfolios. I will usually buy and sell a stock in a couple of days, if not the same day.
You will get a statement from Ameritrade at the end of the year showing your gains and losses. Remember, if you mess up in the future, the money you lose comes off your earnings so it's what you net.
Don't get too happy and go and do something stupid now

 

[funkyman]

Thanx a lot guys. I really appreciate it.

 

[funkyman]

What's a good website(s) for stock info / referrals, say for penny stocks or or any other direct stock buying?

 

[tangman99]

I don't think we can post links even for non-fish related sites but I will tell you that other than finacial sites to do due-diligence research, there are no expert sites for anything. Unless you know what you are doing, DO NOT JOIN OR TAKE ADVICE FROM MESSAGE BOARDS! (Except from me on this one.

)Most of these are "pump and dump" postings and penny stocks will break you in no time. You can pick a lucky stock every now and then and some people on these boards seem like experts, but it all boils down to the saying "Even a blind squirrel finds a nut every now and then."
If you want to have an advantange trading stocks, pick quality stocks (not penny) and learn a little about Technical Analysis. It's not that difficult and you will still make bad choices at times. The key is to protect your buys and win more than you lose. It's kind of like playing black jack. You can't win every hand, but if you can count cards and win more than you lose, you make money.
I'm not a day trader, but I buy and sell everyday in the market. I'm what they call a swing trader. I may hold a stock a few hours, a few days or a few weeks but not much longer than that. I don't fight the trend and I make money in bull and bear markets because I buy, sell, short and cover stocks as needed. On any given day, I'll have about 10 orders in on market open with buys, sell, short and covers sometimes totaling 6 figures. I never place market orders (limits only) so they don't always execute. On average, probably 3 a day get executed.
Sorry, I know you did not ask for a stock lesson, but I've been doing this for a long time. When I see someone asking for information about penny stocks, I just want to make sure they understand the risk. I only give you the above information to qualify my experience. I'm a big believer in the stock market and you can make some very good money in it, but it is a risk you have to manage or you will lose every time.
Good luck and go slow.

 

[funkyman]

Thanx to all who responded.
Tangman, I need all the advice I can get, so don't worry about the lesson. What's selling short?

 

[tangman99]

Originally Posted by funkyman
Thanx to all who responded.
Tangman, I need all the advice I can get, so don't worry about the lesson. What's selling short?
You "short" a stock when you think the price of the stock is going to go down instead of up. You are selling the stock first, then buying it back later after the price has dropped (hopefully).
For example, a stock is currently priced at $80 and technical analysis points toward it being oversold and probably going to have a correction. You put in an order to Sell Short 100 shares for a limit price (remember the lesson of never buying at market unless it costs you more to place a limit order) of $80.00. When it executes, you will have $8,000 added to your account and -100 shares showing. You just sold 100 shares that you don't currently own. Now you have to buy them back so you can give them back to your broker. At this point you put in a limit "Buy to Cover" order for say $75. When (If) the stock drops to $75, you will then buy the stock to return to the broker and you made $500 in cash.
Note, this is more risky that just buying a stock. If you buy a stock outright, the worst that can happen is the stock goes bust and you lose all your money. If you sell it short and it goes up, there is really no limit to how high it can go so you can lose a lot. Leave Short selling and Buying to Cover for when you get a little experience. I did not start shorting stocks for a couple of years.