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Tax loss harvesting: slice and dice

Posted: Thu Aug 15, 2019 5:22 pm
by jgalt133
A lot of people seem to propose TLH by finding a "pair" (e.g. VTIAX to FSGDX). Why not also just TLH by selling VTIAX and buying VTMGX and VEMAX in the appropriate market-weight ratio (e.g., 4:1 as suggested by viewtopic.php?t=163885).

Re: Tax loss harvesting: slice and dice

Posted: Thu Aug 15, 2019 5:43 pm
by livesoft
One might need to have enough money from selling to meet 2 initial minimum purchases. With Specific Identification and only harvesting losses of the lots with losses one might not even have enough for 1 initial minimum purchase.

One can ask many of these "Why not?" questions, such as "Why not sell VTIAX and buy ITOT?" or "Why not buy VFWAX and VFSAX to replace VTIAX?" or "Why not buy VEU and VSS?"

One can also just buy VTSAX since it is moderately correlated to VTIAX.

It's Personal Finance, so a person can do anything they want, right? The possibilities are endless.

Re: Tax loss harvesting: slice and dice

Posted: Thu Aug 15, 2019 5:57 pm
by H-Town
jgalt133 wrote:
Thu Aug 15, 2019 5:22 pm
A lot of people seem to propose TLH by finding a "pair" (e.g. VTIAX to FSGDX). Why not also just TLH by selling VTIAX and buying VTMGX and VEMAX in the appropriate market-weight ratio (e.g., 4:1 as suggested by viewtopic.php?t=163885).
Why not? One time, I TLH'ed VXUS with VEA and VWO. You just have to accept the fact that simplicity is out of the window. There will be more things to keep track of and it won't be quick to unwind the new position.

If it's your hobby, then yeah. If not, find something simpler.

Re: Tax loss harvesting: slice and dice

Posted: Thu Aug 15, 2019 6:07 pm
by stan1
Today swapping between VXUS and IXUS is pretty simple. In 2008 it was more complicated.

Re: Tax loss harvesting: slice and dice

Posted: Thu Aug 15, 2019 6:22 pm
by Wiggums
I agree with livesoft. There are so many possibilities.

Re: Tax loss harvesting: slice and dice

Posted: Fri Aug 16, 2019 1:21 am
by fujiters
Wiggums wrote:
Thu Aug 15, 2019 6:22 pm
I agree with livesoft. There are so many possibilities.
And if prices keep falling, you can cycle through them as you harvest more losses.

It's nice to have many possibilities!

Re: Tax loss harvesting: slice and dice

Posted: Fri Aug 16, 2019 10:07 pm
by jgalt133
H-Town wrote:
Thu Aug 15, 2019 5:57 pm
Why not? One time, I TLH'ed VXUS with VEA and VWO. You just have to accept the fact that simplicity is out of the window. There will be more things to keep track of and it won't be quick to unwind the new position.

If it's your hobby, then yeah. If not, find something simpler.
Good point. It seems like a simple mathematical equation to rebalance, etc. But, you're right, it does make a four-fund portfolio a five-fund portfolio!