If the dividend can continue at its present level, at least least you are being somewhat rewarded for taking risk by investing in this sector at this time.
I like to use the analogy of going to the casino to play your favorite table game(s) or slot machine(s) . Sometimes the house wins sometimes you do.
If you beat the casino, you will in all probability receive a 1099 from them, that you will be required to declare on your 1040. Uncle Sugar will tax this as ordinary income. Yes you can offset gambling losses to the extent of gambling winnings, but of course YOU NEVER LOSE AT THE CASINO. RIGHT!!!
Now an investment in Noranda Aluminum.. The dividends are income taxed (generally) at 10% or 15%,
Should the stock price increase and you sell it at a capital gain, the capital gains tax could be as low as 0%.
(assuming the holding period is greater than one year .Each person's marginal tax rate is different and such a discussion is best left with your financial advisor or tax consultant as to what your actual tax burden might be.
If you should lose when you sell this stock, you can offset the capital loss (again assuming the holding period exceeded 1 year) against first other capital gains, and then up to $3000.00 of ordinary income with any remaining losses carried forward to future tax years.
Gambling losses can only be used to offset gambling earnings.
In closing, from a tax perspective, an investment in Noranda may very well leave more after tax dollars in your pocket than going to your favored casino.
What I am saying is this, the dollars you have to go to the casino should instead be invested in this stock
Yes, the 'ACTION" one experiences at the tables/machines is not there, but for me a fair tradeoff. I believe that if one wants to get rich, GET RICH SLOWLY. Doesn't happen at the blackjack table.