Top Ripple Exec Claims He Sold Stocks to Harvest Losses

David Schwartz, the chief technology officer at Ripple, recently revealed that he had sold his stocks at a loss on Friday for the purpose of tax-loss harvesting.

The prominent Ripple executive also bought other stocks that he likes as much to maintain his exposure to the market.

Schwartz says that he could potentially switch back to the recently sold stocks following a 31-day period.

The rules of the Internal Revenue Service (IRS) do not allow tax deductions if the same stocks are repurchased within a month.

In a nutshell, Schwartz has used a common strategy of realizing his short-term capital losses in order to be able to reduce his taxable income.

“The ones I sold are ones I recently bought. I try to keep losses short-term and gains long-term when I can,” he explained.

Earlier this week, the U.S. stock market experienced the biggest two-day wipeout in history, with more than $6 trillion worth of total losses.

Meanwhile, financial experts are arguing that Americans should refrain from making hasty moves with their 401 (k)s. Tax-harvesting is among some of the top recommendations alongside diversification and gaining exposure to buffer exchange-traded funds (ETFs), according to Fortune.