In the end I cleared out three of my smaller share holdings (@$19.95 brokerage per trade), realising $7,096.39:
Stock Price Qty Net
Sold LDW $2.500 1,350 $3.355.05
Sold BBW $0.820 1,782 $1,441.29
Sold THG $0.580 4,000 $2,300.05
As LWD and BBW had 0% margin value, and THG only 50%, selling these stocks will have the same impact on my Comsec gearing as injecting $6,000 of cash. It will also reduce the number of individual stocks I own and therefore simplify my annual tax calculations of dividends and trust income.
I also placed an order to BUY 90 IANG shares with the proceeds, but the order hasn't been filled as yet. At around $77 the IANG shares are trading at a substantial discount to the underlying bond portfolio (around $100 per share), and yield a fully franked dividend of around 6%. The next reset date for the shares is 15 March 2010, at which time they may be redeemable for closer to the full $100 than their current market value. I already have 200 of these shares, so I'm just adding to an existing holding rather than adding another new security to my portfolio. The IANG shares have a margin of 80%, so using the sale proceeds to buy this stock will still have the effect of adding another $5,000 cash to the portfolio.
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