04-16-2021, 10:13 AM
you can always try.
But in reality what you are doing here is two trades.
#1 You are letting go of ORC for about 2 weeks.
#2 And you are buying NLY, grabbing the div, and then selling.
The success of #1 is entirely dependent on ORC's price movement in that time. So essentially it's timing the market. (hard!)
The success of #2 is purely dependent on betting that it will recover from the dividend dip in about two weeks. The stock WILL dip roughly the amount of the dividend on the ex-div date.
Essentially, what you are doing here is getting rid of ORC to get money and then betting that money on the fact that NLY will go back up after the ex-dividend date. Just remember that it's not a certainty that it goes up. I would suggest that if you want to do this, just use extra cash on NLY. Or even a paper trading account. And just forget about selling ORC for the moment. Make sure you can trade NLY first, then decide where to get the cash to do so.
But in reality what you are doing here is two trades.
#1 You are letting go of ORC for about 2 weeks.
#2 And you are buying NLY, grabbing the div, and then selling.
The success of #1 is entirely dependent on ORC's price movement in that time. So essentially it's timing the market. (hard!)
The success of #2 is purely dependent on betting that it will recover from the dividend dip in about two weeks. The stock WILL dip roughly the amount of the dividend on the ex-div date.
Essentially, what you are doing here is getting rid of ORC to get money and then betting that money on the fact that NLY will go back up after the ex-dividend date. Just remember that it's not a certainty that it goes up. I would suggest that if you want to do this, just use extra cash on NLY. Or even a paper trading account. And just forget about selling ORC for the moment. Make sure you can trade NLY first, then decide where to get the cash to do so.