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SCHY
Dec 12, 2021 23:16:06 GMT
Post by yogibearbull on Dec 12, 2021 23:16:06 GMT
If you want to swap into similar funds,
EM ETFs are VWO, IEMG, EEM
International ETFs are VXUS, IXUS, ACWX
After booking tax-losses, you can then evaluate the bigger picture for later adjustments.
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SCHY
Dec 13, 2021 0:50:47 GMT
via mobile
Post by chang on Dec 13, 2021 0:50:47 GMT
I'm selling FEMKX and FIGRX for tax loss harvesting. Not sure how these funds work, but I got large capital gains - reinvested, but am down slightly in FEMKX and about even on FIGRX for the year. Results in a decent size loss. Bought 1/11/21, so short term loss. I see some indecision on SCHY. I want international exposure - both developed and EM. This will be about 6.5% of my portfolio. Does anyone have some solid long term hold choices I can research for a taxable account? I plan to hold SCHY for the foreseeable future; in fact, I will probably add to it this week using part of the proceeds of something I want to sell. I also have VGWAX and definitely consider that a LT hold. There aren’t that many good international LV/Dividend funds (VIGI is one). Lastly, I think FEMKX is a top-notch pick under the current manager; I own it in my IRA.
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Deleted
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SCHY
Dec 13, 2021 1:51:12 GMT
chang likes this
Post by Deleted on Dec 13, 2021 1:51:12 GMT
Thanks Chang - I like FEMKX too - just not sure how I got big cap gains along with a loss in my account. Its in my taxable account. I usually hold individual stocks - get dividends which I expect. This caught me off guard. Maybe just sell it, book the loss. Thinking maybe etfs are more beneficial from a tax perspective in a taxable account?
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SCHY
Dec 13, 2021 2:51:05 GMT
Post by chang on Dec 13, 2021 2:51:05 GMT
Thinking maybe etfs are more beneficial from a tax perspective in a taxable account? No question about that. Actively managed OEFs can deliver a nasty blow come distribution time. 10% distributions have not been uncommon in recent years.
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SCHY
Dec 13, 2021 3:09:06 GMT
Post by yogibearbull on Dec 13, 2021 3:09:06 GMT
@slooow, actually on purchases on 1/11/21, you have only a tiny loss in FEMKX and gain (!) in FIGRX. But you have large tax liabilities due to their high CG distributions (these will be in your 1099 and will have a separate entry on your Schedule D). Those distributions are ADDED to your original cost basis by the broker so that you don't pay taxes twice on those distributions whenever you sell (now or later), and that may be misleading you on "losses" indicated in the brokerage statement. So, you are not really doing tax-harvesting here (I took your word on it previously, but from your details, I don't see it).
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Deleted
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SCHY
Dec 13, 2021 10:54:52 GMT
Post by Deleted on Dec 13, 2021 10:54:52 GMT
@slooow , actually on purchases on 1/11/21, you have only a tiny loss in FEMKX and gain (!) in FIGRX. But you have large tax liabilities due to their high CG distributions (these will be in your 1099 and will have a separate entry on your Schedule D). Those distributions are ADDED to your original cost basis by the broker so that you don't pay taxes twice on those distributions whenever you sell (now or later), and that may be misleading you on "losses" indicated in the brokerage statement. So, you are not really doing tax-harvesting here (I took your word on it previously, but from your details, I don't see it). Okay. That makes better sense to me. I knew I had to be missing something. Thank you very much! But if I sold, wouldn't I realize losses that could offset gains?
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SCHY
Dec 13, 2021 14:44:40 GMT
chang likes this
Post by rhythmmethod on Dec 13, 2021 14:44:40 GMT
@sara - I see some indecision on SCHY. I want international exposure - both developed and EM. This will be about 6.5% of my portfolio. Does anyone have some solid long term hold choices I can research for a taxable account?
Since I was one who first voiced indecision/disappointment with SCHY, I'll re-weigh in. Recently I took a pretty good look at its 10 largest holdings. I think they represent very large stable multi-national equities. That with the 4% dividend has prompted me to add (after the div payment) and give it another year. As others have mentioned, Europe may find itself on the upside of the COVID ping pong match within a year thus increasing its growth possibilities. In full disclosure, I did sell my smallish position in FISMX, only to simplify my holdings, thus having a bit more int $ to invest in int. I decided to go with LCV instead of SCV. Good luck either way.
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SCHY
Dec 28, 2021 8:10:17 GMT
via mobile
Chahta likes this
Post by chang on Dec 28, 2021 8:10:17 GMT
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SCHY
Dec 29, 2021 12:37:26 GMT
chang likes this
Post by Chahta on Dec 29, 2021 12:37:26 GMT
That is one complicated methodology.
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Post by roi2020 on Dec 30, 2021 1:32:58 GMT
FWIW, the M* ETF research team declared SCHY one of the best new ETFs of 2021. Link
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SCHY
Jan 1, 2022 15:08:48 GMT
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Post by Chahta on Jan 1, 2022 15:08:48 GMT
Just an FYI; SCHY will pay another small distribution on Jan. 4. Not sure why Schwab did that in 2 different years.
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SCHY
May 16, 2023 19:51:25 GMT
Post by anitya on May 16, 2023 19:51:25 GMT
Per M*,
SCHY while paying more dividends than SCHD has (13%) less debt to capital ratio.
VIGI too has 14% less debt to capital ratio than VIG.
I was surprised to see US companies with more debt. What is up with all these dividend US companies loaded with debt? Buy Backs?
It is actually cheaper to borrow in Europe than in the US and European companies seem to have cleaner balance sheets.
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Post by chang on Jun 5, 2023 7:56:35 GMT
Just happend to chart SCHY-VIGI-VYMI. Since SCHY's inception (4/30/21), SCHY beats the other two.
In fairness, over various time periods there are different leaders, meaning this is a comparison which is very sensitive to start and end dates, and probably no meaningful conclusion can be drawn.
It's a pity that M* discontinued rolling returns, in line with its plan to remove all the most useful features from its site.
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SCHY
Jul 14, 2023 23:54:46 GMT
Post by acksurf on Jul 14, 2023 23:54:46 GMT
Chang et al - It seems like some have analyzed the benefits of holding international (SCHY) in taxable. Can you give a sense of the actual financial benefit of doing so? I have something a bit more than a foothold in SCHY in an IRA and could see having a $100-$200K+ in SCHY but wondering if I increase my position how beneficial it would be to do it in taxable....
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Post by fritzo489 on Jul 15, 2023 0:13:10 GMT
appeared at MFO : Foreign taxes in retirement accounts Unfortunately, foreign investments in retirement accounts don't qualify for either a tax credit or deduction.
Because income in a tax-deferred account—such as an individual retirement account (IRA) or 401(k)—isn't subject to U.S. tax (at least not until you begin making withdrawals), you can't deduct foreign taxes paid on investments held in the account. But don't worry—the foreign taxes reduce the income earned in that account. That is, when you eventually withdraw funds from your account, you'll be taxed on the net amount only.
If you have a Roth IRA, the situation is a bit different. Withdrawals from Roth accounts are tax-free, so you won't benefit from the foreign taxes you paid. But don't let the lack of a tax benefit deter you from holding foreign investments in your Roth account; it could still make sense to include foreign assets for diversification and potential growth.
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SCHY
Jul 15, 2023 0:24:32 GMT
Post by Chahta on Jul 15, 2023 0:24:32 GMT
I will assume most retired investors are using the standard deduction anyway.
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SCHY
Jul 15, 2023 2:31:58 GMT
Post by steadyeddy on Jul 15, 2023 2:31:58 GMT
appeared at MFO : Foreign taxes in retirement accounts Unfortunately, foreign investments in retirement accounts don't qualify for either a tax credit or deduction. Because income in a tax-deferred account—such as an individual retirement account (IRA) or 401(k)—isn't subject to U.S. tax (at least not until you begin making withdrawals), you can't deduct foreign taxes paid on investments held in the account. But don't worry—the foreign taxes reduce the income earned in that account. That is, when you eventually withdraw funds from your account, you'll be taxed on the net amount only. If you have a Roth IRA, the situation is a bit different. Withdrawals from Roth accounts are tax-free, so you won't benefit from the foreign taxes you paid. But don't let the lack of a tax benefit deter you from holding foreign investments in your Roth account; it could still make sense to include foreign assets for diversification and potential growth. Large $ amounts of international (dividend paying) equity is better held in a taxable account for the very reasons you mention. However, what can one do if the only money available to invest is in an IRA and you want international exposure? I personally keep taxes in consideration but ultimately I invest the $ in an account to meet my allocation goals.
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SCHY
Jul 15, 2023 3:54:11 GMT
Post by anitya on Jul 15, 2023 3:54:11 GMT
Chang et al - It seems like some have analyzed the benefits of holding international (SCHY) in taxable. Can you give a sense of the actual financial benefit of doing so? I have something a bit more than a foothold in SCHY in an IRA and could see having a $100-$200K+ in SCHY but wondering if I increase my position how beneficial it would be to do it in taxable.... acksurf , I checked my 2022 Form 1099 from Vanguard. The foreign taxes withheld are about 8% of the dividends. FTC or not I will keep it in my taxable account because I consider it a long term hold and it is a non-thematic, passive ETF. Most of the dividend is also reported as qualified dividend. Please share why you are leaning in favor of SCHY relative to alternatives. This is my only international Value play and can add more to it because I have been reducing SCHD but am a bit ambivalent. Thanks.
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SCHY
Jul 15, 2023 6:19:02 GMT
via mobile
anitya likes this
Post by chang on Jul 15, 2023 6:19:02 GMT
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Post by chang on Jul 15, 2023 10:11:46 GMT
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SCHY
Jul 15, 2023 11:32:16 GMT
chang likes this
Post by richardsok on Jul 15, 2023 11:32:16 GMT
The allures of SCHY are lost on me, cheng. Except for a couple of 'meh' semi-annual dividends, it has been dead money since inception; closing yesterday 50 cents below the price it first opened at. Rallies like last week's have inevitably sagged back into tears. Short term: too volatile to track / longer term: comatose. I guess I must have missed something. I usually do.
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SCHY
Jul 15, 2023 12:01:57 GMT
Post by Norbert on Jul 15, 2023 12:01:57 GMT
It's true that TIBIX looks much better than SCHY in this space, but maybe that's not a reasonable comparison.
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SCHY
Jul 15, 2023 12:03:39 GMT
via mobile
Post by chang on Jul 15, 2023 12:03:39 GMT
richardsok: Well, that’s how markets have been outside the US. I guess the question is: what’s the world coming to? I’m expecting capital appreciation from SCHY, in addition to its dividend - current yield is 4.79% per Schwab: www.schwabassetmanagement.com/products/schyI could very well be disappointed. However, its sibling SCHD has done well; I own that, am happy with it, and sleep very well with it. My foreign exposure is considerable. That’s a bet, and there’s absolutely no assurance that it’s a good one.
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Post by Chahta on Jul 15, 2023 12:04:36 GMT
I must admit I own SCHY as part of my small foreign allocation. It is no better or worse than any other foreign holding. We have discussed "is it worth having foreign allocations" several times.
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SCHY
Jul 15, 2023 14:00:34 GMT
Post by acksurf on Jul 15, 2023 14:00:34 GMT
Chang et al - It seems like some have analyzed the benefits of holding international (SCHY) in taxable. Can you give a sense of the actual financial benefit of doing so? I have something a bit more than a foothold in SCHY in an IRA and could see having a $100-$200K+ in SCHY but wondering if I increase my position how beneficial it would be to do it in taxable.... acksurf , I checked my 2022 Form 1099 from Vanguard. The foreign taxes withheld are about 8% of the dividends. FTC or not I will keep it in my taxable account because I consider it a long term hold and it is a non-thematic, passive ETF. Most of the dividend is also reported as qualified dividend. Please share why you are leaning in favor of SCHY relative to alternatives. This is my only international Value play and can add more to it because I have been reducing SCHD but am a bit ambivalent. Thanks. Thanks for checking your Vanguard 1099. Like many here my foreign holdings have dwindled to point that my foreign holdings are less than 2% of portfolio. At the moment, I don't see having a large allocation - probably not much higher than 5% in the short term - to foreign but think that it probably should be a bit higher than it currently is. As I am shifting to more of a dividend income portfolio I'd like the foreign allocation to pay out dividends which is why I am thinking of SCHY.
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Post by liftlock on Jul 15, 2023 14:03:03 GMT
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SCHY
Jul 15, 2023 18:05:49 GMT
Post by anitya on Jul 15, 2023 18:05:49 GMT
liftlock , If you know the answer off hand, can one take FTC while itemizing other taxes? These days there is a cap on itemization of taxes.
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SCHY
Jul 16, 2023 0:59:40 GMT
Post by liftlock on Jul 16, 2023 0:59:40 GMT
liftlock , If you know the answer off hand, can one take FTC while itemizing other taxes? These days there is a cap on itemization of taxes. Yes, The $10,000 itemized deduction cap applies only to State and Local Taxes. So Foreign Taxes paid can be claimed as an itemized deductions beyond the $10,000 SALT cap. The calculations can be seen on Form 1040 Schedule A lines 5e, 6 and 7: www.irs.gov/pub/irs-pdf/f1040sa.pdfHowever, one cannot take an itemized deduction for foreign taxes paid if a tax credit is taken for foreign taxes paid. It's generally better to take the tax credit rather than the itemized deduction for foreign taxes paid. Itemized deductions reduce taxable income whereas a tax credit reduces taxes owed. www.irs.gov/individuals/international-taxpayers/foreign-tax-credit-choosing-to-take-credit-or-deduction
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SCHY
Jul 16, 2023 1:49:30 GMT
Post by liftlock on Jul 16, 2023 1:49:30 GMT
appeared at MFO : Foreign taxes in retirement accounts Unfortunately, foreign investments in retirement accounts don't qualify for either a tax credit or deduction. Because income in a tax-deferred account—such as an individual retirement account (IRA) or 401(k)—isn't subject to U.S. tax (at least not until you begin making withdrawals), you can't deduct foreign taxes paid on investments held in the account. But don't worry—the foreign taxes reduce the income earned in that account. That is, when you eventually withdraw funds from your account, you'll be taxed on the net amount only. If you have a Roth IRA, the situation is a bit different. Withdrawals from Roth accounts are tax-free, so you won't benefit from the foreign taxes you paid. But don't let the lack of a tax benefit deter you from holding foreign investments in your Roth account; it could still make sense to include foreign assets for diversification and potential growth. These are all valid points, but it does mean the foreign investment returns in an IRA are reduced by the amount of the foreign tax.
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SCHY
Jul 16, 2023 3:08:02 GMT
Post by steadyeddy on Jul 16, 2023 3:08:02 GMT
Don't focus too much on tax implications of foreign dividends. Do think about king dollar depreciating against foreign currencies which gives an oomph to the overall returns from foreign investments. In the end, this issue might prove to be a rounding error.
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