My previous comments were based upon a taxable account.
For an IRA, any additional funds would be taxed as ordinary income upon distribution; therefore, the overvalue price over fair value price ratio would need to be 1.33 if there was no compounding in interest.
However, there is a time delay between the acquisition of the extra capital and the tax, so compounding should occur.
My head is aching over trying to make that calculation, so I plan to use the more conservative ratio of 1.33 for my IRA.
For an IRA, any additional funds would be taxed as ordinary income upon distribution; therefore, the overvalue price over fair value price ratio would need to be 1.33 if there was no compounding in interest.
However, there is a time delay between the acquisition of the extra capital and the tax, so compounding should occur.
My head is aching over trying to make that calculation, so I plan to use the more conservative ratio of 1.33 for my IRA.