These 10 companies have reaped the biggest capital gains over the past year – and Biden’s tax plan could send them tumbling, Goldman says

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  • President Biden’s proposed hike in the capital gains tax rate could hurt high-flying stocks, according to Goldman Sachs.
  • “High-momentum ‘winners’ that had delivered the largest gains to investors ahead of the rate hike have usually lagged,” Goldman said.
  • The 10 stocks listed below have generated eye-popping capital gains over the past year and could suffer if Biden’s tax plan is enacted.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

A proposed capital-gains tax hike by President Joe Biden is nothing the stock market can’t handle, according to a Friday note from Goldman Sachs’ David Kostin.

But some stocks would be more susceptible to losses than others if the proposed tax hike to 39.6% for those making more than $1 million went into effect, according to the note.

“High-momentum ‘winners’ that had delivered the largest gains to investors ahead of the rate hike have usually lagged,” Kostin explained. Over the last few years, stocks within the technology and consumer discretionary sectors have been that largest source of capital gains, meaning those sectors might lag if the tax hike is approved.

These are the ten S&P 500 companies that have delivered substantial capital gains over the past year and would likely lag the broader market if Biden’s capital gains tax hike is enacted, according to Goldman Sachs.

10. Generac

Ticker: GNRC
1-Year Return: 233%

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9. Etsy

Ticker: ETSY
1-Year Return: 235%

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8. Tapestry

Ticker: TPR
1-Year Return: 237%

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7. Enphase Energy

Ticker: ENPH
1-Year Return: 321%

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6. Freeport-McMoRan

Ticker: FCX
1-Year Return: 355%

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5. Gap

Ticker: GPS
1-Year Return: 368%

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4. Tesla

Ticker: TSLA
1-Year Return: 392%

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3. Caesars

Ticker: CZR
1-Year Return: 527%

czr ccc.JPG

2. L Brands

Ticker: LB
1-Year Return: 548%

lbrand.JPG

1. Penn National

Ticker: PENN
1-Year Return: 575%

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Bitcoin slides below $50,000 with $260 billion wiped off the crypto market as Biden’s tax proposals crush risk appetite

GettyImages 1312494009

Bitcoin slid below $50,000 on Friday, extending losses for a seventh day in a row, while simultaneous drops in other digital currencies erased $260 billion off the total value of the cryptocurrency market.

The world’s most widely traded digital asset fell 4% to around $49,130, ether fell 7% to around $2,220, Dogecoin fell 17% to $0.17, and XRP dropped 8%.

The crypto market has come under fresh pressure after reports that US President Joe Biden is looking to double the capital gains tax rate on wealthy investors.

Biden’s proposals are aimed at funding expanded childcare and education programs. Federal tax rates, including an existing surtax on investment income, could be as high as 43% for those earning more than $1 million, according to Bloomberg.

The Internal Revenue Service has been executing tax collection on crypto gains. Crypto is taxed as property, not currency. The agency began requiring crypto investors to disclose transactions on their 2019 tax returns, asking whether they “received, sold, sent, exchanged or otherwise acquired any financial interest in any digital currency.”

“It is clear that bitcoin is more sensitive to capital gains tax threats than most ‘asset’ classes,” Jeffrey Halley, a senior market analyst at OANDA, said. “The threat of regulation, either directly in developed markets or indirectly via the taxman, has always been crypto’s Achilles’ heel. Yes, you could store those juicy capital gains offshore as a US citizen, but we know how the G-Man treats tax evaders. It is not pretty.”

JPMorgan warned this week there could be further downside for bitcoin if it fails to climb back above the $60,000-level. Guggenheim’s Scott Minerd also recently said bitcoin could pull back to $20,000 or $30,000 after rising much too fast in a short period of time.

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