After much consideration and some discussions with my accountant, I decided to close some trades and take a loss on 3 major losers of nearly $78,000. By closing these badly losing trades, it allowed me to take an overall loss in 2017 of just over $1,100. Otherwise, I would have earned over $77,000 in profit on my closed trades had I not closed these 3 awful losers. I have made the mistake in previous years of taking decent profit for the year on my closed trades without really getting ahead after having to pay CG tax on it. One poster stated on this forum that profits are only realized “after you close a trade (or trades).” This is true - especially for tax purposes - but unlike stocks, in reality it’s your entire portfolio / account that usually comes into play in forex.
In essence, by closing those 3 nasty trades I have avoided a substantial profit in 2017, and in turn, avoided paying capital gains taxes on that profit, and cleaned up my portfolio significantly as I improved my leverage and ability in future trading. Had I not closed those 3 trades, I would have been paying capital gains taxes on 50% of my approximate 77k profit. Based on my entire portfolio and situation, I believe it was a good decision. Next December, I will have to once again evaluate where I am at with my portfolio and make any key decisions on how to proceed.
See my attachments. One are the trades I closed on Dec. 29, 2017 in the last couple of hours before the market shut down in 2017. The other is the last portion of all of my trades in 2017 including my profit-loss for the year.
Comments??? I welcome your opinions…