UPS stock part deaux

[BigBrownSanta]

Do you happen to know the buying windows? First couple weeks of a quarter?

The fee to reinvest the dividends is also a flat $10. So $10 every quarter for purchasing the stock and another $10 each quarter for the dividend reinvestment.

It's been awhile but I believe they made both transactions at the same time which is what caught my attention on the statements and rubbed me the wrong way about the additional $10 fee.

I'm not sure what you mean by buying windows.

It's been at least 4 years since the last time I bought stock. It looks like some things have changed since then. I dont remember having to pay fees to purchase stock.

Maybe someone who is currently active in the DESPP has an answer that will be more helpful to you.

 

[Catatonic]

Do you happen to know the buying windows?
There is a buying window that opens one day after the quarterly UPS announcement and stays open for 30 days. This window only applies to Corporate and higher management people in the district or ANYONE that has insider knowledge of plans or conditions that would materially affect the price of UPS Stock. Anyone else can sell/purchase UPS stock at any time.First couple weeks of a quarter?

The fee to reinvest the dividends is also a flat $10. So $10 every quarter for purchasing the stock and another $10 each quarter for the dividend reinvestment.

It's been awhile but I believe they made both transactions at the same time which is what caught my attention on the statements and rubbed me the wrong way about the additional $10 fee.

 

[1989]

The window is open from 9:30-16:00 eastern time Monday-Friday on the NYSE

 

[gandydancer]

The closing price on Sep 30 2008 was 62.89, minus 10% you will be buying at 56.60.

If the closing price on Dec 30 2008 is over 52.00, with the 10% discount, you'd be buying at over 46.80.

Today's closing price was 46.55.

Since you buy in at the lower of the prices at the beginning or end of the quarter, would you be better off buying on the open market now or waiting and buying through the Stock Purchase Plan in January?

Accepting your calculations... obviously, if you're 100% dead certain sure the price will be over $52 on Dec 30th you'd like to stop your weekly contributions for any week where the price is above $46.80 (ignoring transaction costs) and buy the stock in the market. And you ought to mortgage your house and hock your wedding ring and scrounge up as much cash as you can and buy at the absolute bottom and get rich. But if you have such Nostradamus-like predictive ability about the market, why are you working?

For my part, I figure the DESPP is free money over any reasonable period of time, so I put the DESPP max, $10,000/yr ($192/wk), into it, and, since I can't afford to save that much and in any case don't want to be any more over-invested in one company than I can help, pull out the shares as soon as I've got 100+ eligible for capital gains treatment. That's when there are gains that you want to be taxed at the capital gains rate. This year it may make sense to recognize an ordinary-income loss by selling everything in December --- I'll have to think about the implications of that. Anyway, I don't try to outguess the market much. It's too hard to come up with a better estimate, today, for the discounted future returns on your stock than today's stock price. I'd try to avoid selling into a panic, but if UPS drops into the 30's and stays there for a few months you really need to come to terms with the fact that the stock you bought for twice that is really only worth half what you paid for it.

 

[BigBrownSanta]

Accepting your calculations... obviously, if you're 100% dead certain sure the price will be over $52 on Dec 30th you'd like to stop your weekly contributions for any week where the price is above $46.80 (ignoring transaction costs) and buy the stock in the market. And you ought to mortgage your house and hock your wedding ring and scrounge up as much cash as you can and buy at the absolute bottom and get rich. But if you have such Nostradamus-like predictive ability about the market, why are you working? LOL, I was not trying to predict the future.

For my part, I figure the DESPP is free money over any reasonable period of time, so I put the DESPP max, $10,000/yr ($192/wk), into it, and, since I can't afford to save that much and in any case don't want to be any more over-invested in one company than I can help, pull out the shares as soon as I've got 100+ eligible for capital gains treatment. That's when there are gains that you want to be taxed at the capital gains rate. This year it may make sense to recognize an ordinary-income loss by selling everything in December --- I'll have to think about the implications of that. Anyway, I don't try to outguess the market much. It's too hard to come up with a better estimate, today, for the discounted future returns on your stock than today's stock price. I'd try to avoid selling into a panic, but if UPS drops into the 30's and stays there for a few months you really need to come to terms with the fact that the stock you bought for twice that is really only worth half what you paid for it.

I was trying to say (in a not too clear way) that if the stock price were to start rising, then 52.00 would be the point that would equal friday's closing price of 46.55. If the price were to rise above 52.00, the DESPP plan would have you buying shares at a higher price than if you had bought on friday. It was a subtle dig at the DESPP for being too restrictive.

On the other hand, if the stock price were to keep tanking, you'd be buying at a bargain with the DESPP.

 

[Zigzag99]

there is no fee for Reinvesting your dividends. There is a ten dollar fee four times a years for each actual stock purchase they make for you. The reinvestment plan they have does not charge you to use. Scottrade charges 7 so its ten, big deal. I have no prob with the program. I look at it this way the 180 I put in a week is a gamble yes, but at least half of that would just go to things I really dont need. I dont even notice it missing from my check anymore. I am a driver like many of you I make a very good living, I would rather gamble on the market than look back in ten years and figure out what i spent that 100.000 on. No I do not have all my eggs in one basket, but this is basic logic. Compounding money. Remeber the story? "If you save a dollar a day you will have 365 in a year" When a dollar may not be much 365 is. I usually dont have much to say but this Mellon program is actually something I recomend to all UPSers

 

[p400npaper]

very well said. My investment strat all most to a t. Id spend it on beer and guns, ok may be guns.

 

[wyobill]

That is correct for a price of $46.55 / share and dividends of $1.80
If the price is $70 / share (hopefully a realistic price a year from now) and keeping the dividends at $1.80 will equal a yield of 2.57

70 bucks a year from now? I'm not going to hold my breath on that one.