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Thread: Questions From Newbies Like Me

  1. #11

    Join Date
    Feb 2009
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    654

    Default The Uptick Rule?

    I'm hearing more rumors about the uptick rule being reinstated. I started paying attention to ETFs after the uptick rule was yanked and I know nothing about it. I'll do my normal outside reading about it, of course, but would anyone care to give a quick and dirty thumbnail sketch of what it is and how it is used in trading?

    Lady
    If you think education is expensive, try ignorance. - Derek Bok

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  3. #12

    Join Date
    Dec 2007
    Posts
    906

    Default Re: Questions From Newbies Like Me

    Once upon a time, you could not short a stock unless it saw an uptick in price. Shares used to trade in fractions so the uptick would have been something like an 1/8 or 1/16 of a dollar.

    So, you could not sell short a stock if it's last tick was down. This kept traders from relentlessly pushing a price down. If you had an order to sell short at the market, you wouldn't get filled until the stock moved up in price.

    Now that we trade stocks in pennies and fractions of pennies, I am not sure how they will implement the rule. Will stocks have to move a nickle, a dime, etc., before it can be shorted?
    -- Tom | My Trades

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  5. #13

    Join Date
    Feb 2009
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    654

    Default Re: Questions From Newbies Like Me

    Quote Originally Posted by XL-entLady View Post
    I'm hearing more rumors about the uptick rule being reinstated. ...would anyone care to give a quick and dirty thumbnail sketch of what it is and how it is used in trading?

    Lady
    Quote Originally Posted by etftalk View Post
    Once upon a time, you could not short a stock unless it saw an uptick in price. Shares used to trade in fractions so the uptick would have been something like an 1/8 or 1/16 of a dollar.

    So, you could not sell short a stock if it's last tick was down. This kept traders from relentlessly pushing a price down. If you had an order to sell short at the market, you wouldn't get filled until the stock moved up in price.

    Now that we trade stocks in pennies and fractions of pennies, I am not sure how they will implement the rule. Will stocks have to move a nickle, a dime, etc., before it can be shorted?
    Thanks for the quick response! I love stories that start out 'once upon a time'!

    Lady
    If you think education is expensive, try ignorance. - Derek Bok

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  7. #14

    Join Date
    Jan 2009
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    Upstate NY
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    142

    Default Re: Questions From Newbies Like Me

    Quote Originally Posted by XL-entLady View Post
    Here's another newbie question from me. I really like the long-term prospects of FXI, the China ETF. But I've never invested in a foreign ETF before and I'm clueless about the tax implications of the ETF and its dividends (and whatever else I probably should know that I don't).

    Teknobucks or Bullitt, can you shed some light here?
    You might have to pay foreign capital gains if pays out capital gains. If it pays dividends, same thing. I have a minor problem with an ETF I have that paid a foreign dividend and was reported on a modified tax form from Scottrade after I submitted my taxes and received my refund. What can you do? I think that was just a remote instance because half of my portfolio is in foreign stocks/ETF's and I've never had a problem. It's not that hard to report, Scottrade gives tells you what dividends are qualified and foreign and all that. You just have to type it in. I've owned DEO for a while and even when they paid a special dividend it wasn't a problem for me.
    "Don't let your highs get too high and don't let your lows get too low." Bullitt’s Market Blog

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  9. #15

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    Mar 2009
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    In Your Imagination...
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    Arrow Re: Questions From Newbies Like Me

    Quote Originally Posted by justbizness45 View Post
    How do you trade during the day and work? I am afraid the computer Nazi's will nail me for non government related internet use.
    I would recommend NOT using gov. computers to trade. Heck, I don't even access the forums while at work.
    "You rise. You fall. You're down then you rise again. What don't kill ya make ya more strong." - Metallica

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  11. #16

    Join Date
    Feb 2009
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    654

    Default Re: Questions From Newbies Like Me

    Quote Originally Posted by Bullitt View Post
    You might have to pay foreign capital gains if pays out capital gains. If it pays dividends, same thing. I have a minor problem with an ETF I have that paid a foreign dividend and was reported on a modified tax form from Scottrade after I submitted my taxes and received my refund. What can you do? I think that was just a remote instance because half of my portfolio is in foreign stocks/ETF's and I've never had a problem. It's not that hard to report, Scottrade gives tells you what dividends are qualified and foreign and all that. You just have to type it in. I've owned DEO for a while and even when they paid a special dividend it wasn't a problem for me.
    Thanks for the information, Bullitt. I'll just trust in my Scottrade and Turbotax then.

    Lady
    If you think education is expensive, try ignorance. - Derek Bok

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  13. #17

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    Feb 2009
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    654

    Default Re: Questions From Newbies Like Me

    I just got an ad for a list of the top 40 dividend-paying stocks. And it made me wonder. Does anyone know where there is a list of the top dividend-paying ETFs?

    Lady
    If you think education is expensive, try ignorance. - Derek Bok

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  15. #18

    Join Date
    Dec 2007
    Posts
    906

    Default Re: Questions From Newbies Like Me

    Quote Originally Posted by XL-entLady View Post
    I just got an ad for a list of the top 40 dividend-paying stocks. And it made me wonder. Does anyone know where there is a list of the top dividend-paying ETFs?
    http://seekingalpha.com/article/34939-26-dividend-paying-etfs-by-yield
    -- Tom | My Trades


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  17. #19

    Join Date
    Feb 2009
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    654

    Default Re: Questions From Newbies Like Me

    Quote Originally Posted by XL-entLady View Post
    IDoes anyone know where there is a list of the top dividend-paying ETFs?

    Lady
    You're so good! Thanks!

    Lady
    If you think education is expensive, try ignorance. - Derek Bok

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  19. #20

    Join Date
    Feb 2009
    Posts
    654

    Default Re: Questions From Newbies Like Me

    Here's another newbie question.

    I see that Vanguard's VIPERS have a seriously smaller expense ratio than, for example, iShares. So that's good, but there's got to be a down side. What is it?

    TIA to anyone who can give me some insight!

    Lady
    If you think education is expensive, try ignorance. - Derek Bok

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