5.5Delivery trading: advantages and disadvantages
1What is it?
A summary of when delivery suits you and when it doesn’t.
2Why does it exist?
Choosing a style means accepting its trade-offs.
3Advantages
- ✓Full ownership, dividends and voting rights.
- ✓No time pressure; no forced square-off.
- ✓Lower tax if held >12 months.
- ✓Lower stress than intraday.
4Risks
- Needs full capital (no leverage).
- Money is tied up.
- Prices can stay down for long periods.
- STT is higher (0.1% each side).
5Quick revision
- Best for beginners and long-term investors.
- Needs patience and full capital.
6Knowledge check
Q1. Name two advantages of delivery.Show answer
Ownership/dividends, no time pressure, lower long-term tax.
Q2. Name one disadvantage.Show answer
Full capital needed, or money tied up.
Q3. Do you get dividends on delivery shares?Show answer
Yes, if held on the record date.