These tax-loss selling targets are also table-pounding buys

financialpost.com:

As we approach year-end, many investors are turning their attention to tax-loss selling, the strategy of selling investments that have experienced a loss in order to offset capital gains and potentially reduce an investor’s tax liability.

There are a few potential benefits of tax-loss selling. The primary benefit is the ability to use capital losses to offset capital gains. If an investor has realized capital gains during the tax year, then realizing capital losses through the sale of other investments can help offset these gains. This could potentially reduce their overall tax liability.

Tax-loss selling also provides an opportunity for investors to rebalance their portfolios. By selling underperforming investments, investors can reallocate their assets to align with their investment goals and risk tolerance.

A third benefit is that investors may use tax-loss selling to exit investments that are no longer aligned with their investment strategy. This can help maintain a diversified portfolio and reduce the risk associated with concentrated holdings.

Investors employing this strategy are generally anxious to complete any trades before year-end so that the losses can be claimed on this year’s tax return. Sometimes, a hasty sale of shares can be completed without much concern for the share price, which can cause downward pressure and present an attractive buying opportunity for astute investors.

We have identified (and own) three attractive buying opportunities for companies whose shares have experienced downward pressure this year, and have no doubt suffered lower share prices due to recent tax-loss selling.

Canadian Tire is a retailer most of us are familiar with. The company boasts a strong brand and is a household name.