Is it possible to sell stock for more than you bought it and not make money?

Question

Assume I sell some stock that I have been holding for less than a year for a total of $50 profit. After a borkerage fee of $7 and capital gains tax (15% for me) that still leaves $35.55.

So if I sell higher than I bought, as long as I make enough to cover any fixed (non percentage) fees associated with the trade, I will make SOME money. Right?

Are there any factors besides brokerage fees and capital gains tax that I should consider?

Answer 1

The capital gains tax is taxed on the net profit (after the brokerage fee).  So $50 minus $7 = $43.00 X 15% tax = $6.45 tax.  $43 net profit minus $6.45 tax leaves an after tax return of $36.55.

Also did you figure the $50 gross profit with a cost basis that INCLUDES the brokerage fee to buy the stock?  You may have even more left.

There may be a few pennies to pay for a SEC stock transfer type fee (I forget the real name).  Again, don't pay tax on that fee either.

To answer your question - Right, you will make some money.

Answer 2

NO.

You got it, the fees could get you, commision , ticket charge, and the tax eats away from the profit, but as long as you know and consider these factors, you will make money.

Answer 3

Yes slippage can drastically affect your profit if the stock has a big spread. Sounds like it may be a penny stock with a big spread and you may have sold market and been given a much lower bigd than the last price you saw printed.

Answer 4

Opportunity costs.

Answer 5

Do not forget state and local taxes and inflation.

Answer 6

$36.55 would be left, not the $35.55 you mentioned.

$50 - $7 = $43

$43 x (1-.15) = $36.55 after transaction costs and taxes

I can't think of any other costs of investing past transaction costs and taxes.