Dividends and Tax Selling

Every year, in December they will be some selling and buying because of tax time and equally important making the year end results look good. The tax is the last day the capital gains can be locked into this year’s income tax filings. In addition there will selling to make balance sheets look good at the mutual fund industry because they need to be presented to clients. 99% of us invest to make money, while we all do not, if a fund is losing money at the end of the year, do you wish to hold it for another year? Maybe, but likely not this means the mutual fund industry has to make its accounts look pretty if they are not already. One can remember this years losers maybe next year’s best gainer. Although the adage is buy low and sell high, a remarkable number of people do it the other way – buy high and sell low.

Linking to dividend paying stocks, regulations often drives the industry and depending on the size of your portfolio, you may wish to take advantage of it. When others are selling, given you have done your homework, you could be buying.

There are more questions than answers, till the next time – to raising questions.

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