Year End Issues & Opportunities: Mutual Funds (not advice of course)

Here’s an article from that points out the issue: click here.

Look at this publicly-available document (link), which reports the expected distributions from mutual funds. One fund is going to distribute 45% of your investment in the form of a distribution, that will be subject to income taxes, your money was in a taxable account.

So, on top of the -28.49% loss (as of 12/13/2022 close), you will also need to pay taxes on another $8.65 per unit that you own. OUCH.

Moral of the story: taxes matter, and in mutual funds, the opaque nature of the accounting makes it difficult when the market is lower. The reality is that it has always been difficult, but people gloss over it when the market is up.

We’ve mentioned this in the past, now it’s come home to roost.