Wolfe Research published a list of stocks that might go down because mutual funds sell their losers every fall. This passes for analysis now. They figured out that fund managers dump garbage in September to offset their winners before December 31st. Revolutionary stuff.
The strategy here is beautiful in its stupidity. Buy the stocks that professional money managers are contractually obligated to sell regardless of price. Front-run the forced sellers. Catch the falling knife with your face. You're not investing anymore. You're just eating someone else's tax problem.
Mutual funds have been doing this for forty years. Every September. Like clockwork. Wolfe Research wrote it down and called it research. They probably charged someone for the PDF. Some retail trader in Michigan is reading this right now thinking he found the edge nobody else knows about. He's about to buy stocks with names like "Carvana" and "Peloton" because a research firm said fund managers will sell them. That's the whole thesis. Professional sellers are coming. Better get in there first.
The tax bill angle is even dumber. You're supposed to buy these stocks now so you can sell them at a loss later to offset your gains. Except you don't have gains. You lost money on GameStop in 2021 and you've been bagholding Disney since it was at $180. Your entire portfolio is a tax-loss harvest. You are the crop.
Wolfe Research could've just tweeted "stocks go down sometimes" and saved everyone the trouble. But then they couldn't put it in a client note. They couldn't justify the subscription fee. They couldn't pretend September selling is some dark secret instead of the most predictable trade in finance. So here we are. A research firm telling you to buy stocks that are about to get sold. And you're going to do it anyway because the headline said it could help your taxes.
Your tax bill is zero dollars. You lost money again this year.
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