Year End Tax Harvesting
I always end up waiting until the last minute, and this year is no exception. I took a quick scan of my portfolio yesterday and decided to sell a couple holding that we had significant paper loss on to harvest some tax losses before the end of 2011.
I'm happy owning what investments we have now, but all things being equal it makes more sense to sell these holdings with significant unrecognized losses and invest the proceeds in an equivalent or peer investment so we can gain the immediate benefit of the tax loss.
I ended up selling our investment holdings in Radian (RDN) and a portion of our holdings in Dryships (DRYS). Both of these stocks have been very volatile this year and our average cost basis for each holding is significantly higher than the current market value. We only sold our early investments in Dryships and continue to hold our more recent purchases which have a much lower cost basis.
As far as the proceeds I'm thinking we will just invest those in the Vanguard Total Market Index (VTI) for now.
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