[Tax loss harvesting VTSAX / VOO]

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Topic Author
Elmo
Posts: 4
Joined: Wed Mar 25, 2020 1:57 pm

[Tax loss harvesting VTSAX / VOO]

Post by Elmo » Thu Mar 26, 2020 10:36 am

[split from VTSAX vs VOO - moderator prudent]

This is my first post so I haven't figured anything out and I apologize to the old hats at this. I have been reading for many months and have learned a lot from many of you. Thank you for your patience and expertise.

A significant difference between VTSAX and VOO or even VTI - Ease of tax loss harvesting. It seems that at VG you can simply exchange a MF for another and there are a fair number of TLH (tax loss harvesting) partners there. It is a simple, no nerves exchange.

I did a TLH 3 times recently with ETFs, twice in international and once from VTI to VOO and it is harrowing. The planning, the anxiety watching the numbers (I am on Fidelity and I think they are less delayed than Vanguard) and hoping the price will still be dropping when you place your buy order (even with limits) it is a lot for me! The volatility is Real, with the bid/ask spreads not 1 penny at this time mostly.

I would like to figure a way to get into the funds, didn't know tax-loss harvesting would be something I would even entertain, but it seems risky to sell at the end of the day in an ETF and get what you get for the MF price.

Maybe I am missing something (please let me know if I am) but it seems that the ease of TLHing, given the opportunity will, according to many here, present itself makes a MF more attractive even if the ER is slightly more.

Elmo

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iceport
Posts: 4486
Joined: Sat Apr 07, 2007 4:29 pm

Re: [Tax loss harvesting VTSAX / VOO]

Post by iceport » Thu Mar 26, 2020 12:47 pm

Elmo wrote:
Thu Mar 26, 2020 10:36 am
Maybe I am missing something (please let me know if I am) but it seems that the ease of TLHing, given the opportunity will, according to many here, present itself makes a MF more attractive even if the ER is slightly more.

Elmo
Welcome to the forum, Elmo!

I don't think you're missing a thing!

Some folks need to use ETFs because their broker won't let them trade the mutual funds they want. Some ETFs have significantly lower expense ratios.

If those constraints don't apply to you, I think it would make little to no sense at all to favor ETFs over mutual funds.

(And I suspect many folks who need to use ETFs have convinced themselves that they also want to use ETFs. ;-) )
"Discipline matters more than allocation.” ─William Bernstein

livesoft
Posts: 70424
Joined: Thu Mar 01, 2007 8:00 pm

Re: [Tax loss harvesting VTSAX / VOO]

Post by livesoft » Thu Mar 26, 2020 12:50 pm

Everybody seems to be different. I suspect you will have some anxiety with mutual fund transactions as well, but that should not prevent you from trying to use mutual funds.

I don't find I have any anxiety nor need to do any planning to make ETF trades. It is certainly not harrowing for me. Instead, I would say it is a lot of fun and gives me pleasure. I am annoyed with mutual fund transactions because I cannot see what happened until hours later when my vendors update my accounts. But I don't even have any anxiety with mutual fund transactions.

But do things often enough so that they become familiar and anxiety should go away.
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Topic Author
Elmo
Posts: 4
Joined: Wed Mar 25, 2020 1:57 pm

Re: [Tax loss harvesting VTSAX / VOO]

Post by Elmo » Thu Mar 26, 2020 3:53 pm

Thank you for the input iceport & livesoft. I am at Fidelity and wondering if it would be advisable to transfer my taxable to Vanguard. I think with this market it wouldn't be swift in happening. Alternately I could just keep going and learn to be more relaxed about it as I do it more often as livesoft suggests.

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