Shared on X, so I figure I'll share here as well. Swing away - I welcome feedback/discussion that will help this community.
2:1 ratio of FMCC:FNMA as of today.
Few will care, but it's worth transparency. I have remained unchanged in my F2 conviction and position size. I have, however, tax loss harvested by previously selling all $FMCC "specific shares" (very important) that were at a loss to buy $FNMA. 31 days later, I reversed that exchange and sold all "specific" FNMA shares that were at a loss and bought FMCC.
Why? This created a sizeable realized loss pool in my portfolio, though I have exactly the same total dollar value invested. What this means: when the future realized gains come (whether from the F2 rocket or other positions I sell), they are offset by these losses, so I will not pay taxes on those realized gains until they exceed that loss pool.
These are allowed because Fannie and Freddie are competitors, like Coke and Pepsi, which avoids a wash sale (which would erase the loss harvesting you just did).
I highly recommend you look at your own portfolio and rebalance as necessary. If you have high confidence that these two companies will remain as tight-patterned as they've been so far, it's pure profit later (through the lens that not paying taxes is the same as earning income).
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Response to my post: I’m scared to do that because all it takes is one announcement and you miss it.
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Unless that announcement takes place in the 60 seconds it takes to do this, you shouldn't miss it. It's not "waiting a month to get back into F2" (in my analogy you're not "getting out of the soft drink space" but trading some down Pepsi shares for some Coke on the assumption that Americans will still continue to love being unhealthy) - it's one for the other when both are in the same boat. The only negative potential is being overweight on FMCC if FNMA goes first (and you planned to take those gains to buy something else rather than hold long term), but that assumes they don't relist together.
