I do believe that LUCKY referred to people selling in Jan 98 in order to take their profits in a future quarter and a future year. Thus they would not need to pay taxes on them until they declared their Quarterlies in April 98 -- thus deferring tax payments by some 3 months. IMHO, that's letting the tail wag the dog. I don't like the idea of making investment decisions based primarily upon tax condiderations.
Having said that, when I was feeling uncomfortable about my humongous gains in ABTX, which threatened to unbalance my portfolio, I considered selling my original stake and letting the "house money" ride. But that would have triggered a short term capital gain in 1997. Instead, I elected to buy some Puts -- farthest out, lowest strike price available -- which cost me less than the tax would have been had I sold.
It is my intention ... nay, my fervent hope ... that these options will expire worthless.
But, until July of 1998, I have at risk only that part of each ABTX share which is worth more than 7 1/2 dollars. Or, viewed another way, the first 7 1/2 of each ABTX share is locked in value until July 98, so it puts the risk part of my portfolio back into better balance.
JSb. |
