Current Events > can anyone explain to me how stocks work?

(+) Yeah! (+)

i'm looking to just try it out.
not spending any large amounts, just a little something to get the hang of it.

there's one i'm looking at here which is at 214 Euro at the moment.
can i just invest like 20 Euro or is it an all or nothing deal?

if i were to invest the 214 now, and it goes up to 220 and i sell, am i making 6 euros out of it or more/less?

You buy them and then they go down

You can buy partial shares. And yes, that would be the amount of profit you would have. It wouldn't be a realized gain unless you actually sell it at that price, though.

• Unrealized gain: Stock went up and you haven't sold it yet
• Realized gain: Stock went up and you sold it at a higher price

Irony posted...

You buy them and then they go down

So I can punish any company I want?

You put your head and arms in the holes and someone locks you in. Everyone laughs at you.

MedeaLysistrata posted...

So I can punish any company I want?

If you got the money

https://gamefaqs.gamespot.com/a/user_image/1/4/3/AAX6AYAADuj3.jpg
https://gamefaqs.gamespot.com/a/user_image/1/4/4/AAX6AYAADuj4.jpg

CableZL posted...

You can buy partial shares.

i tried now, and apparently not

ROBANN_88 posted...

i tried now, and apparently not

Which trading platform are you using?

DrewAllar posted...

Yes.

You buy it and then the price changes over time.

You will be successful if you pick ones that go up over time.

Look at the % change rather than the $ change.

Don't forget that you aren't taxed on the $6 profit. You're taxed on the full $220 sale of the stock.

CableZL posted...

Which trading platform are you using?

it's a swedish platform called Avanza

ROBANN_88 posted...

it's a swedish platform called Avanza

I looked into it a bit more and apparently it depends on whether the platform you're using allows it.

I use Etrade and they apparently don't allow fractional share purchases. I definitely have fractional shares, but I guess they came from dividend reinvestments and not straight purchases.

Tom_Joad posted...

Don't forget that you aren't taxed on the $6 profit. You're taxed on the full $220 sale of the stock.

oh, so if you buy at, let's say 219 and sell at 221, you'd likely end up being taxed more than whatever profit you'd get out of it?

don't knwo about europe but you're taxed on capital gain, so just the profit, but there's such thing as long term capital gain and short term capital gain. short term is taxed higher.

CableZL posted...

I looked into it a bit more and apparently it depends on whether the platform you're using allows it.

I use Etrade and they apparently don't allow fractional share purchases. I definitely have fractional shares, but I guess they came from dividend reinvestments and not straight purchases.

yeah, i was looking to buy into Rheinmetall to start with, figured with the war, weapons manufacturies would be a pretty safe bet, but with it being at 219 Euros a piece at the moment, that's a bit much for me to start just on a hunch.
if fractions were possible, i wouldn't mind so much

ROBANN_88 posted...

oh, so if you buy at, let's say 219 and sell at 221, you'd likely end up being taxed more than whatever profit you'd get out of it?

In the US at least, you're only taxed on realized gains, which would be the $2 you profited.

yeah, looking at the text, here it seems to also be taxed on profit i think, the language used goes a bit over my head

also, looking at the charts, i'm seeing two values, one in green and one in yellow, anyone know what that's about?
https://gamefaqs.gamespot.com/a/user_image/0/7/1/AAKbOWAAEJJ3.png

If I understand it correct, the yellow line stands for the German DAX stock exchange, and the green line is for the stock you are looking at.
It is so you can see how good/bad the stock is compared to the specific stock exchange it is sold at.

ROBANN_88 posted...

oh, so if you buy at, let's say 219 and sell at 221, you'd likely end up being taxed more than whatever profit you'd get out of it?

Yep. At least, that's how the tax laws work in the US. I tried out the stock market in the US for a year... and found out that I had to pay taxes on all the money gained from a stock sale (without being able to subtract the initial cost of the stock itself). After that, I stopped trading.

Tom_Joad posted...

Yep. At least, that's how the tax laws work in the US. I tried out the stock market in the US for a year... and found out that I had to pay taxes on all the money gained from a stock sale (without being able to subtract the initial cost of the stock itself). After that, I stopped trading.

You're taxed on capital gains in the US, not the entire cost of the stock. If you buy at 100 and sell at 150, your capital gains = 50, and you're taxed on that amount. The amount you're taxed on that amount would change depending on whether it's a short or long term profit.

When you file, you're supposed to enter the amount you bought at and the amount you sold at in the boxes to calculate your total capital gains on a particular sale.

they don't

CableZL posted...

You're taxed on capital gains in the US, not the entire cost of the stock. If you buy at 100 and sell at 150, your capital gains = 50, and you're taxed on that amount. The amount you're taxed on that amount would change depending on whether it's a short or long term profit.

When you file, you're supposed to enter the amount you bought at and the amount you sold at in the boxes to calculate your total capital gains on a particular sale.

I received a consolidated 1099 from Etrade when I was actively trading. When it came time to do my taxes, I used H&R Block. Their software didn't even have that option.

So I couldn't even begin to input the purchase value.

Tom_Joad posted...

I received a consolidated 1099 from Etrade when I was actively trading. When it came time to do my taxes, I used H&R Block. Their software didn't even have that option.

So I couldn't even begin to input the purchase value.

You might have used the wrong form or something.

https://gamefaqs.gamespot.com/a/user_image/1/3/8/AABjoOAAEJK6.jpg

Every tax filing company in the US has to follow the same regulations when it comes to filling in data, so they can't just not have the correct fields for people to fill in.

CableZL posted...

You might have used the wrong form or something.

https://gamefaqs.gamespot.com/a/user_image/1/3/8/AABjoOAAEJK6.jpg

Every tax filing company in the US has to follow the same regulations when it comes to filling in data, so they can't just not have the correct fields for people to fill in.

This is good info, thank you!