I was wondering if anyone employs the ETF tax loss selling strategy outlined in the ol' Radical Investing guide, now at:
It sounds like a great idea during your yearly rebalancing, but you might lose out by having to move into a less appropriate index to avoid the wash-sale rule.
Basically, to summarize, at the end of the year, you look at which ETFs have lost value during the year. Say the S&P500 (SPY) has dropped and you lost $3k. So you sell that for a loss, and purchase the Russell 1k with the proceeds from the sale since it is a fairly similar index. You now have the $3k to use as a rebate against ordinary income I believe.
Just wondering as it sounds like a great idea...