Welcome to European Tribune. It's gone a bit quiet around here these days, but it's still going.
My model is not good enough for this level of accuracy (as I said) and is indeed not consistent.

Since you can't buy groceries with your shares, the shareholder wil have to sell, when he sells he will pay capital gain tax (or income tax), which can be more than company profit taxes.

If you bought at 100 and sold at 106, you make 6 in additional income which is taxed. If you hold on your share longer, you need to take into account risk-free interest rate, etc...

I don't know if retirement funds are taxed on capital gain, if not, we now know why they vote for share buybacks.

by Laurent GUERBY on Sat Dec 23rd, 2006 at 06:36:45 AM EST
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