As a regular reader of Wealth Daily, you’re probably quite familiar with a technique called tax-loss harvesting.
If you’re not, let me break it down for you really quickly…
At the end of the year, when you’re looking at a pretty big tax burden from the income you’ve earned over the year and, hopefully, the winning investments you’ve closed out, there are measures you can take to reduce that burden.
If you’ve got any investments that are in the negative, you can sell them, record those losses, and use them to reduce the amount of income you’ll be taxed on come April.
The only rule is that you have to wait at least 30 days before you buy back into them or a similar asset. So you can’t go swap one S&P 500 ETF for another and call it a loss.
You’ve got to sell and take a break to avoid what’s known as a wash sale. But if you do that, you’ve effectively reduced your tax burden for the year.
It’s a very common strategy among stock market investors. But this year, it looks like a new group of folks has discovered its beauty…
And it’s making for some incredible deals in that market.
Tax-Loss Harvest of Plenty
I’m talking about all those new-to-investing folks who got infatuated with cryptocurrencies of late.
They’ve had a pretty good year, with many coins still doubled in value. But they’ve also seen some pretty harsh downturns.
So there are a lot of gains out there and a lot of losses that can be taken to make it hurt less when the taxman comes calling.
And you can actually see the harvesting going on in the chart of Bitcoin, the original crypto coin:
It’s shed about 30% of its value since early November as traders sell off parts of their investments for losses to cushion the gains they got earlier this year.
But the thing with tax-loss harvesting is that investors usually buy those assets back once they’ve made it past the wash-sale window.
So that means there’s probably going to be a nice rally coming as all those people start trying to buy back a limited amount of coins.
But I’m not recommending you buy Bitcoin today. In fact, I’m recommending you don’t buy Bitcoin at all right now.
Because there are far better currencies out there. And I’m not talking about Ethereum either.
Bitcoin is old and Ethereum is slow. There are newer, faster, better cryptocurrencies out there.
And the folks buying back crypto assets in the new year are going to have a laser focus on those coins in particular.
That’s why the rally I see coming isn’t in Bitcoin at all.
It’s in those smaller, newer, lesser-known but just-as-powerful assets.
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New Kids on the Block
These newer currencies solve many of the problems found in the original crop of cryptos.
They’re offering rapid, private transfers. They’ve got the ability to earn interest.
They’re more private and secure than a Swiss bank account and give 100% anonymity.
They’re literally designed to go up in value faster than the original coins; it’s in the programming.
And they’re all poised to put Bitcoin’s meteoric gains to shame as word gets out and investors pile in.
But today, you’ve got the opportunity to learn all about these newer, better cryptos and get yourself invested long before the crowd drives their prices to the moon.
That’s because I happen to work with one of the original cryptocurrency clairvoyants and bulls on Bitcoin.
This is a guy who recommended Bitcoin under $500 and Ethereum under $100.
Those two insights set his investors up for 14,250% and 4,800% gains, respectively.
And he’s convinced these coins could do even better for those who get in early enough.
So take a little time out of your day today and hear what he has to say. You won’t regret it.
And I’ll be back on Monday with your first financial insights of the new year and another way to get your money working harder for you.
Happy New Year, everybody!
To your wealth,
After graduating Cum Laude in finance and economics, Jason designed and analyzed complex projects for the U.S. Army. He made the jump to the private sector as an investment banking analyst at Morgan Stanley, where he eventually led his own team responsible for billions of dollars in daily trading. Jason left Wall Street to found his own investment office and now shares the strategies he used and the network he built with you. Jason is the founder of Main Street Ventures, a pre-IPO investment newsletter; the founder of Future Giants, a nano cap investing service; the editor of Alpha Profit Machine, an algorithmic trading service designed specifically for retail investors; and authors The Wealth Advisory income stock newsletter. He is also the managing editor of Wealth Daily. To learn more about Jason, click here.
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