ASX Shares Investing in Big Miner at 50% Discount?

Ha ha, I think we posted the same thing at the same time

 

I've always liked corporate share programmes. I did the woodside and the chevron ones.
I remember for quite a few years the Woodside shares were $12 buy in, then jumped to $15.80 then down to $12 for quite a few years. Everyone hated that $15.80 tranche but eventually the shares did get to $20 in about 2006. Quite a few staff sold then as they'd been waiting 5-10 years to see profits on those but the best movement was to come with more growth to $30 then $40 in the next 3yrs from then.

Most of these programmes where you get a matching amount have conditions on them that you can't sell them for xx years and there were selling embargoes around announcements.

I know people that used the gains every 5 years or so to raise deposits to buy IPs.

 

Ah yes, i wasn't taking into account the original shares, and the loss from them. I was only looking at the 'free' shares based on $6k.

 

Nope, you're right, I was only thinking of the 'free' shares when considering it. My bad.

 

I was involved in BHP's employee share plan many moons ago. We received a interest free loan to buy the shares, with dividends used to pay off the loan or buy more shares. It seemed to be an arbitrage, because the price just kept on getting higher. When I quit I sold enough shares to pay off the loan and keeping the remaining unsold shares. If the share price had gone down, I would have been in trouble.

I don't understand if yours is an arbitrage. You say you get 200 free shares but pay income tax. Do you mean FBT?

Anyway, if it IS an arbitrage situation, that is, they are giving you something for free, take it.

 

Hey @ErYan

This is how the program works. I buy $1500k worth of shares quarterly (from my own money, no loan), total yearly investment 6k. Say I bought 240 shares this year. In three years (in 2020), the company gives me another 240 shares for free. Those "free" 240 shares form part of my taxable income for FY2020 and I need to pay tax on them.

What do you think? I'm heading down the way of ETF's and not sure whether to stop being part of this program and just focus on ETF's.

Cheers