Agreed. "Tax harvesting" your losses, is done frequently by people in high tax brackets.
What good is it to make money, then send it to uncle sam?
This is exactly the position shareholders are in, because of an illegal conscrewtorship.
It makes great sense, for people with tax problems to harvest those losses, then buy the stock back after 31 days.
It does not always work, of course. If you sell, then intend to buy back in 31 days, well, your stock could go to the moon while you dont own it. Its a calculated risk.
The risk seems good, as its not incredibly likely, that the conservatorship will go away in just 31 days. Fannie is not a good short term investment. You should consider something else if you expect to make money in under 31 days.
Actually, I do. My speculative stocks are only about 5 to 10 percent of my portfolio. Speculative stock is a stock just like fannie.
Remember, rookie investors "buy a stock", where pro's "build a portfolio". I would not advise someone to have a portfolio of 100 percent FAnnie mae stock. While it would depend on your "risk tolerance", I pretty much never have over about 20 percent in my speculative stocks, and that would only be because I started with 5 percent, and the speculative stock outgrew my other portfolio, and grew to 20 percent. That is ideal.
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