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Re: Sprott Intends to Make Exchange Offers for Central GoldTrust and Silver Bullion

Posted: Wed Jan 20, 2016 1:37 pm
by steve
al14 wrote: ..and why would anyone want to sell their PHYS given that there is no difference whatsoever between it and GTU for tax or other purposes (besides redemption option, that is useless for most and doesn't affect US taxes)
I sold just because I do not want to have anything to do with Sprott because of  the takeover and the way it was done.  I made it work in my best interest taking advantage of a tax loss harvest.  I added to my core physical bullion and bought IAU and then also sold that for a tax loss harvest and now have GLD  As far as I know there is no wash sale rule for collectibles so that is also an advantage. 

Re: Sprott Intends to Make Exchange Offers for Central GoldTrust and Silver Bullion

Posted: Wed Jan 20, 2016 2:36 pm
by dragoncar
steve wrote:
al14 wrote: ..and why would anyone want to sell their PHYS given that there is no difference whatsoever between it and GTU for tax or other purposes (besides redemption option, that is useless for most and doesn't affect US taxes)
I sold just because I do not want to have anything to do with Sprott because of  the takeover and the way it was done.  I made it work in my best interest taking advantage of a tax loss harvest.  I added to my core physical bullion and bought IAU and then also sold that for a tax loss harvest and now have GLD  As far as I know there is no wash sale rule for collectibles so that is also an advantage.
Leaning toward keeping it now... If tax effect is the same and fees are similar.  I was under the impression that the redemption option WOULD affect US taxes

I'm not gonna make financial decisions out of spite

Re: Sprott Intends to Make Exchange Offers for Central GoldTrust and Silver Bullion

Posted: Wed Jan 20, 2016 3:10 pm
by al14
Same here. As much as I detest what Sprott has done to Gold Trust I see no other option to maintain paper gold under favorable US capital gain taxation rules. My understanding is that shifting to GLD or IAU exposes to clearly spelled out 28% collectible tax rate, besides the ETF papers not being backed up by unencumbered metal in the vault.

Re: Sprott Intends to Make Exchange Offers for Central GoldTrust and Silver Bullion

Posted: Wed Jan 20, 2016 3:11 pm
by Dmilligan
Dmilligan wrote: Anyone have any guess as to how long this conversion will take? What's the soonest I will be free to sell out of PHYS?
PHYS showed up in my Fidelity account today at market close. So, looks like the exchange has been effectuated.

Re: Sprott Intends to Make Exchange Offers for Central GoldTrust and Silver Bullion

Posted: Wed Jan 20, 2016 4:57 pm
by al14
No PHYS in my brokerage, neither GTU is there. Showing 100% loss of entire investment. Is that a drill for things to come? :)
I'm extremely puzzled by investor irrationality: if the offer from Polar was overwhelmingly rejected by GTU unit holders just a few months ago, why would the same people elect to convert to PHYS in a landslide a few days ago, while there is almost no difference between what Polar wanted and what PHYS is? 

Re: Sprott Intends to Make Exchange Offers for Central GoldTrust and Silver Bullion

Posted: Wed Jan 20, 2016 6:12 pm
by steve
al14 wrote: Same here. As much as I detest what Sprott has done to Gold Trust I see no other option to maintain paper gold under favorable US capital gain taxation rules. My understanding is that shifting to GLD or IAU exposes to clearly spelled out 28% collectible tax rate, besides the ETF papers not being backed up by unencumbered metal in the vault.
The 28% gain rate depends on the bracket your in "When you sell collectibles, the special 0%, 15%, and 20% tax rates on long-term capital gains don't apply. Instead, you'll owe tax at your ordinary tax rate, with a cap of 28%. As is the case with all assets, short-term capital gains on the sale of collectibles are taxed at ordinary rates"
I also won't miss filing the required forms every year ( f8621) to take advantage of favorable capital gains treatment which can also change.
In the mean time with my tax loss harvest strategy I offset paying any capital gains tax on my profits and have banked losses to offset possible future gains.  If you really want  gold and not paper buy bullion and put it in a vault that is under your control.

Re: Sprott Intends to Make Exchange Offers for Central GoldTrust and Silver Bullion

Posted: Wed Jan 20, 2016 9:05 pm
by Libertarian666
al14 wrote: ..and why would anyone want to sell their PHYS given that there is no difference whatsoever between it and GTU for tax or other purposes (besides redemption option, that is useless for most and doesn't affect US taxes)
Because I don't want to deal with "people" like Sprott.

Re: Sprott Intends to Make Exchange Offers for Central GoldTrust and Silver Bullion

Posted: Wed Jan 20, 2016 9:07 pm
by Libertarian666
al14 wrote: Same here. As much as I detest what Sprott has done to Gold Trust I see no other option to maintain paper gold under favorable US capital gain taxation rules. My understanding is that shifting to GLD or IAU exposes to clearly spelled out 28% collectible tax rate, besides the ETF papers not being backed up by unencumbered metal in the vault.
Other than buying CEF, of course.

Downside: silver content.
Upside: large discount, which is likely to go away at some point in the future.

If I had a significant amount of new money to put to work, that's probably what I would do.

Re: Sprott Intends to Make Exchange Offers for Central GoldTrust and Silver Bullion

Posted: Wed Jan 20, 2016 9:09 pm
by Desert
What about physical gold?  I know I'm off topic, but I really think that when gold is needed most, we won't want to be looking at it on a screen, we'll want it in our possession. 

Re: Sprott Intends to Make Exchange Offers for Central GoldTrust and Silver Bullion

Posted: Wed Jan 20, 2016 9:13 pm
by Libertarian666
Desert wrote: What about physical gold?  I know I'm off topic, but I really think that when gold is needed most, we won't want to be looking at it on a screen, we'll want it in our possession.
Sure, but you're right that it's off topic in this thread.  :P

Re: Sprott Intends to Make Exchange Offers for Central GoldTrust and Silver Bullion

Posted: Wed Jan 20, 2016 9:19 pm
by Desert
Libertarian666 wrote:
Desert wrote: What about physical gold?  I know I'm off topic, but I really think that when gold is needed most, we won't want to be looking at it on a screen, we'll want it in our possession.
Sure, but you're right that it's off topic in this thread.  :P
Ok, I'll go off and fondle my physical gold then.  ;)

Re: Sprott Intends to Make Exchange Offers for Central GoldTrust and Silver Bullion

Posted: Thu Jan 21, 2016 4:57 am
by LazyInvestor
Mine converted fine too. I guess I have to also rationally check their prospectus and the trust rather than selling it just because I'm pissed off with the conversion.

Re: Sprott Intends to Make Exchange Offers for Central GoldTrust and Silver Bullion

Posted: Thu Jan 21, 2016 1:14 pm
by dragoncar
Did anyone have to pay some brokerage fees for the conversion?  Is your cost basis adjusted correctly?  I haven't checked mine yet

Re: Sprott Intends to Make Exchange Offers for Central GoldTrust and Silver Bullion

Posted: Thu Jan 21, 2016 1:58 pm
by LazyInvestor
No conversion fees. Partial share was sold to round down the number of shares (0.2 share in my case) and cash was deposited. Cost basis looks fine.

Re: Sprott Intends to Make Exchange Offers for Central GoldTrust and Silver Bullion

Posted: Thu Jan 21, 2016 2:00 pm
by Reub
I'll bet that the ones that haven't converted yet are held in Vanguard. They are dreadfully slow.

Re: Sprott Intends to Make Exchange Offers for Central GoldTrust and Silver Bullion

Posted: Thu Jan 21, 2016 7:50 pm
by dualstow
Showed up in Vanguard Jan 20. Well, I guess it showed up today (21st), but in transaction history, the Corp Action is 1/20.

Re: Sprott Intends to Make Exchange Offers for Central GoldTrust and Silver Bullion

Posted: Mon Feb 08, 2016 9:30 am
by LazyInvestor
Just got rid of all my PHYS!

Re: Sprott Intends to Make Exchange Offers for Central GoldTrust and Silver Bullion

Posted: Mon Feb 08, 2016 9:50 am
by Reub
Why? PHYS has been performing just as well as GLD, or IAU. Why get rid of it?

Re: Sprott Intends to Make Exchange Offers for Central GoldTrust and Silver Bullion

Posted: Wed Mar 02, 2016 3:23 pm
by dragoncar
Picked up some CEF to tax loss harvest the PHYS.  At around 5% discount, I'm ready for a takeover now!  I know it isn't pure PP, but I'm only planning to hold for a month (although I'll see how I feel in a month).  Hopefully this is kosher with wash sale rules, as I suppose the gold component could be considered equivalent, but they are certainly very different securities given all the other differences in management, etc.

Re: Sprott Intends to Make Exchange Offers for Central GoldTrust and Silver Bullion

Posted: Wed Mar 02, 2016 6:54 pm
by Libertarian666
Reub wrote: Why? PHYS has been performing just as well as GLD, or IAU. Why get rid of it?
The reason I got rid of my GTU as soon as it was taken over by Sprott is that I don't want to do business with people who use such tactics as Sprott uses. Performance is secondary to that.

Re: Sprott Intends to Make Exchange Offers for Central GoldTrust and Silver Bullion

Posted: Thu Mar 03, 2016 3:27 pm
by Reub
I would have sold my PHYS also but it's been up so much recently that I don't want to incur the taxes. :)

Re: Sprott Intends to Make Exchange Offers for Central GoldTrust and Silver Bullion

Posted: Thu Mar 03, 2016 7:51 pm
by dragoncar
Reub wrote: I would have sold my PHYS also but it's been up so much recently that I don't want to incur the taxes. :)
Image

Re: Sprott Intends to Make Exchange Offers for Central GoldTrust and Silver Bullion

Posted: Thu Mar 03, 2016 9:02 pm
by pugchief
Reub wrote: I would have sold my PHYS also but it's been up so much recently that I don't want to incur the taxes. :)
You do realize that you don't get a stepped-up basis for the PHYS shares to the date of conversion? The tax basis is whatever you paid for the GTU, which likely was being held at a loss.

Re: Sprott Intends to Make Exchange Offers for Central GoldTrust and Silver Bullion

Posted: Thu Mar 03, 2016 10:24 pm
by Reub
Yes I do but I had a gain because I tax loss harvested out of IAU not that long ago and into GTU, which became PHYS.

Re: Sprott Intends to Make Exchange Offers for Central GoldTrust and Silver Bullion

Posted: Wed Jul 06, 2016 11:11 am
by dragoncar
Earlier, I sold some phys and picked up CEF for tax loss harvesting. I've had it more than a month, but held on because it was performing fine and had a decent discount to NAV. Recently, the discount has closed by a few percent (still no premium). Should I just switch back? During brexit, it lagged gold a bit but seemed to do its job fine