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Author: pmarti Big funky green star, 20000 posts Home Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121482  
Subject: Re: Cap Loss issue Date: 4/29/2001 4:10 AM
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Nearly everything I own is at a loss, and while I would like to move some of my holdings across to other vehicles, like spiders/index funds, and so on, I am concerned about the net loss I will realize on the sales as I move things. I will definitely have a net loss greater than $3K for the year (potentially 10s of thousands in fact) because I do not plan to actively trade after I reallocate my holdings.

The question: how important is it to sell now and get out of some of these holdings versus "sitting tight" and waiting for some of these holdings to get out of the red and into more positive territory so I have a better balance between gain and loss?

In other words, should the tax implications be the driver here or should I simply move things around and lose some "loss" leverage on future gains?


I don't know what you mean by an "active" trader, but if it means that you're going to be holding your investements long-term, the last thing you want to do is have losses to offset them. Long-term capital gains are taxed at a lower rate than other income, so the more of your losses that you can apply against ordinary income at $3,000 per year, the better.

You're invested in things you don't want to be in. Sell them and get yuor money where you want it.

Phil Marti
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