If I own a stock for one year, and the price is the same at the end of the year, did I make any money?

Question

Dividends or something or no?

Answer 1

Did it pay any dividends? Not all stocks pay dividends. And if it did pay dividends, you have to declare the income on it, and pay taxes on it. What most people invest for is not for the dividends, but for increases in the value of the stock over time. To make a long answer short, no you didn't make any money. Course, to make any money even if the stock did rise, you'd have to actually sell it, and then pay income taxes on your gain. Otherwise, all you would have would be unrealized gains.

Answer 2

Assume the stock pays no dividend.
You have a loss, on paper. That is because you paid a commission when you bought the stock. Since you stated the stock price is the same, your cost basis is greater than the current market value by the amount of your commission. If you sell you have the additional loss of a second commission.

Assume the stock pays a dividend.
Now the question is whether or not the dividend is large enough to cover your commission. If it is, you made money. Otherwise you didn't.
If your dollar investment was large (say $10,000) then your commission was very low on a percentage basis. And if your dividend was high, (say 10%) you didn't do too badly. Using those assumptions, and also that you used a discount broker and paid $7.00 commission, your gain would be $993.00 before taxes. Since you held the stock a year, you would be taxed a lower rate.

Answer 3

Nope. You didn't make money. In fact, you lost a little: (A) because you paid sales commission when you bought the stock and (B) because you could have had the money sitting in a risk-free account earning a little interest.

But one year isn't enough time to evaluate an investment. The real question is whether or not the fundamentals that induced you to purchase the stock in the first place are still present. If they are, and you still believe in your decision, then give the market time to catch up.

Of course, as you mention, you might have made some dividend income along the way.

Answer 4

you'll still get dividend (if any). without any dividend, you won't get any money if you don't sell them. even if your stock skyrocketed to a new high, you still get no money too. it is just that your paper asset increase in value.

it is true that the stock prices are normally drop after dividend ex-date. but normally, the price will get 'supported' again as the new investors will come back later.

and because good company doesn't necessarily is a good stock, margin of safety is important to reduce risk of the stock price flattened or reduce even without any news etc.

Step-by-Step Stock Investing for Beginners
http://www.stock-investment-made-easy.com/

Answer 5

is this like a theory question or something?

You COULD have made money if:
1. the stock split and now you have 2x shares at the same price
2. it paid a dividend and the price has returned to the same value as it was one year ago

Answer 6

Only if you drew dividends during the year, (think of them like Interest earned from a bank). Otherwise, if you sell it at the same price you bought it at, you will lose money net, because you also have to pay broker's fees.

Answer 7

you don't make money on a dividend, because when it pays out it will drop the share price by the amount paid. If the stock doesn't move you don't make money, you answered your own question.

example
50 share
5 dividend

you get 5 bucks plus you have to pay taxes on it,

value of share drops to 45 its a wash you still have the same amount of money minus the taxes.