Wash Sale calculation gain/loss question?

Discussion in 'Professional Trading' started by dawsonagh, Mar 29, 2011.

  1. dawsonagh


    I sold an option at a loss and 10 days later, I bought an option with the same stock, sell it at a gain that is larger than the loss of my first sale. Does this means I an net the two together? If it was a net gain, was it not covered under the wash sale?

    If the first sale was at a loss, the second sale was at a gain, but the loss was larger than the loss, if offset each other, it was still a loss. Would both transactions be in the wash sale calculation?
  2. morgen


    The loss of the first trade was added to the cost basis of second trade. Since the second trade has a larger gain than the loss from the first trade, so still ends with a gain. But you sold at a loss and repurchased the same stock within 30 days, this would be considered a wash sale.

    If the gain on the second trade was less than the loss from the first, and the loss of the first trade will be added to the cost basis of the second and would result in a larger loss for the second. It would also be a wash sale. But the loss of the second would not be a wash sale unless another trade was initiated within 30 days.