ORIONS Money Stocks

[oldberkeley]

Today is the last day for tax selling?

No, for both retail and institutional investors, it's the last trading day of the year: Friday, December 30.

However, institutions are very aware of the wash sale rule when doing tax-harvest selling. They want to unload losing positions, but buy some of them back 31 days later. Therefore, you see a lot of institutional selling at the end of November.

Institutions are also keenly aware of the many retail investors who literally wait until the last possible minute to sell their losing positions. The investment bank Keefer,Bruyette & Woods recently said, "Tax-loss selling by retail investors is likely to provide liquidity and allow institutional investors to more easily build positions in these names."

In other words, massive selling of a poorly performing stock by retail investors further lowers the PPS, creating a buying opportunity. The big boys have the funds, the nerve, and the patience to buy our discards at bargain prices.