Velocityshares 3X Long Natural Gas ETN (UGAZ)

[ybnormal]

The wash sale rule prevents one from writing off a loss. Instead of writing off the loss, you add the loss to the cost basis of the new position.

I buy security X at $6 per share, and sell it for $5 per share...a $1 loss. I then purchase a new position in security X for $4.50 per share. I opened the new position within 30 days of my sake so the wash rule applies. My $1 loss is added to my $4.50 shares, for a cost basis of $5.50 per share.