need to sell - now or later?

[feh]

I'm not going to explain why, but I need to sell some shares of an index fund soon. I'm bummed that the market is probably at (or near) its low point, but I don't really have a choice.

So, what does your crystal ball say for the next 2-3 weeks?

[simpletron]

I'm going to ask the magic 8-ball on my officemate's desk. the magic 8-ball says "better not tell you now". oh well.

my guess is some good news(or not as bad as expected) is bound to happen, and we will see a nice uptick in the major indexes. sell during the uptick.

maybe something good will happen in your life and you won't need to sell.

if there isn't a comission, maybe sell half now and half later.

are you sure you have no other choices? including taking on debt.

[creditcardfree]

I say, why risk that it could go lower if you need the cash?

[feh]

I'm going to ask the magic 8-ball on my officemate's desk. the magic 8-ball says "better not tell you now". oh well.

my guess is some good news(or not as bad as expected) is bound to happen, and we will see a nice uptick in the major indexes. sell during the uptick.

maybe something good will happen in your life and you won't need to sell.

if there isn't a comission, maybe sell half now and half later.

are you sure you have no other choices? including taking on debt.

Something good is happening, and that's why I need to sell. My department at work is being spun off, into an LLC, and I'm being offered the opportunity to invest. The deal closes at the end of the month, which is why I need the money soon.

I don't have the money sitting around in cash, so I need to sell existing investments.

The thought crossed my mind of taking out a loan, but it just rubs me the wrong way. My wife and I have 0 debt (paid off our mortgage several years ago), and I like it that way.

[feh]

The thought crossed my mind of taking out a loan, but it just rubs me the wrong way. My wife and I have 0 debt (paid off our mortgage several years ago), and I like it that way.

The more I think about it, perhaps I should examine taking out a loan to finance this investment.

Are there any calculators online that could help me analyze the situation?

Thanks.

[kork13]

The more I think about it, perhaps I should examine taking out a loan to finance this investment.

In nearly all cases, this is NOT a good idea. I'll admit, I did it about 2 years ago, but the loan's rate is only 1% interest. You'll be hardpressed to be on the winning end of a venture such as you're proposing, as most personal loans (which is what you'd need) tend to run anywhere from 8% up to 24% or more. Do you really think your LLC spinoff will be able to best that? That's daring fate, my friend...

if there isn't a comission, maybe sell half now and half later.

This actually is a fair idea.... How much time do you have until the opportunity closes? 2-3 weeks? Following the DCA mindset, one option would be to make multiple sales, perhaps 1-2 sales per week, say every Tuesday and Friday. That would hedge it against any major swings that may occur. Since it's anyone's bet what the market will really do right now, this is the course I would recommend. This does, however, rely on there being no commission on sales, as simpletron noted.

[Optsol]

if there isn't a comission, maybe sell half now and half later.

I'd place more analysis on tax implications vs. comissions.

Offset gains w/ losses or vice versa...

[disneysteve]

While selling in multiple lots may sound good, it would be a nightmare at tax time. Selling mutual fund shares is already a headache if you've been DCAing over time and shares were bought at may different times for many different prices.

I'd sell now and get the amount I needed to get.

I would NOT borrow money for investing.

[feh]

I'd place more analysis on tax implications vs. comissions.

Offset gains w/ losses or vice versa...

Thanks for all the replies, folks.

I've been thinking about the tax implications also - I'd be selling at a loss (which is why I'd rather not sell). Does anybody know (or could point me to the proper IRS document) what the limit is for investment losses when it comes to income taxes?

If I were to have a net loss of $10K on the investment, would that simply reduce my AGI by $10K for next year's taxes?

[feh]

In nearly all cases, this is NOT a good idea. I'll admit, I did it about 2 years ago, but the loan's rate is only 1% interest. You'll be hard pressed to be on the winning end of a venture such as you're proposing, as most personal loans (which is what you'd need) tend to run anywhere from 8% up to 24% or more. Do you really think your LLC spinoff will be able to best that? That's daring fate, my friend...

Are you saying a home loan can't be used for investment purposes?

[disneysteve]

Does anybody know (or could point me to the proper IRS document) what the limit is for investment losses when it comes to income taxes?

If I were to have a net loss of $10K on the investment, would that simply reduce my AGI by $10K for next year's taxes?

You can deduct up to $3,000 per year. If your loss exceeds $3,000, you can carry over the loss to future years.

[kork13]

Are you saying a home loan can't be used for investment purposes?

I think you're misconstruing what I'm saying.... Yes, of course a home can serve as an investment, and for most, that requires a loan. However, more importantly, the home is where you LIVE. Or, if it's an entirely investment home, it provides an INCOME for you. But that's not what you're wanting to do here.... You're thinking to take out a loan in order to invest the money in stocks for your soon-to-be-new company. Two completely separate scenarios. Also, look at interest rates.... Home loans range from ~5-8%. Personal loans normally are between 8-15%, or higher. In order to be on the winning end of that, you've got to beat your interest rate, taxes, and inflation with your ROI. That can be a pretty tall order, especially with a new company--it could do well, but it could flop just as easily. Unless you can find a loan at less than, say, 3% interest (personally, I'd want it below 2%), I wouldn't even consider borrowing to take advantage of this opportunity.

On the taxes note, it's not always a terrible thing to take losses, particularly if you're re-investing the money in similar (or better) investments. You get the tax write-off, but still have the same amount of money invested for you.

[feh]

I think you're misconstruing what I'm saying.... Yes, of course a home can serve as an investment, and for most, that requires a loan. However, more importantly, the home is where you LIVE. Or, if it's an entirely investment home, it provides an INCOME for you. But that's not what you're wanting to do here.... You're thinking to take out a loan in order to invest the money in stocks for your soon-to-be-new company. Two completely separate scenarios. Also, look at interest rates.... Home loans range from ~5-8%. Personal loans normally are between 8-15%, or higher. In order to be on the winning end of that, you've got to beat your interest rate, taxes, and inflation with your ROI. That can be a pretty tall order, especially with a new company--it could do well, but it could flop just as easily. Unless you can find a loan at less than, say, 3% interest (personally, I'd want it below 2%), I wouldn't even consider borrowing to take advantage of this opportunity.

On the taxes note, it's not always a terrible thing to take losses, particularly if you're re-investing the money in similar (or better) investments. You get the tax write-off, but still have the same amount of money invested for you.

You may have misread my question - which is, can the funds from a mortgage be used for a personal investment? If so, I don't understand why you're mentioning the rates for personal loans.

One other bit of information - the loan would likely be paid off in the next 6 months.

Thanks.

[feh]

what to do after today's rally?

The fund I'd be selling is actually an ETF, so I can sell at any time. Anybody think now is the time, after today's 6% rally?

Thanks.

[tripods68]

I'm not going to explain why, but I need to sell some shares of an index fund soon. I'm bummed that the market is probably at (or near) its low point, but I don't really have a choice.

So, what does your crystal ball say for the next 2-3 weeks?

My crystal ball say, we see a small rally for the next couple of weeks. Sorry for not helping you much