Let's say I do the following:
Day 1: Buy 1 share of stock ABC @ $10/share.
Day 2: Shares of ABC go up to $20/share.
Day 3: Buy 1 share of stock ABC @ $20/share.
Day 4: Shares of ABC go down to $15/share.
Day 5: I sell 1 share of ABC for $15.
At Day 4 my total outlay is $30 and my total holdings equal $30.
However I have a gain on my first share and a loss on my second share.
When I sell on day 5, which share does my brokerage sell? Does it matter? What are the tax implications? Did I make money on the sale or lose money on the sale?
Day 1: Buy 1 share of stock ABC @ $10/share.
Day 2: Shares of ABC go up to $20/share.
Day 3: Buy 1 share of stock ABC @ $20/share.
Day 4: Shares of ABC go down to $15/share.
Day 5: I sell 1 share of ABC for $15.
At Day 4 my total outlay is $30 and my total holdings equal $30.
However I have a gain on my first share and a loss on my second share.
When I sell on day 5, which share does my brokerage sell? Does it matter? What are the tax implications? Did I make money on the sale or lose money on the sale?