As a new investor I just wanted to put something on the table and ask if I am thinking straight or if my thinking is skewed. Lets say on the 1st Nov Stock A and Stock B were both trading at $1 each. I decide to buy $1000 of stock A as I think they have better prospects than stock B. Fast forward 5 months and Stock A is trading at 60c and Stock B is trading at 50c. In this time Stock A's future is very grim and stock B looks to be a better long term prospect. So I sell Stock A and incur a 40% loss (-$400) and buy stock B at a 50% discount to the price on Nov 1 ($600 of .50c shares = 1200). I have now gained 20% more shares in stock B than I would have had if I had bought them on the 1st of Nov (1200 vs 1000) Overall I see this as a win situation: : 1200 shares in the better company (opinion) : $400 tax loss to offset a gain Am I thinking correct? Buying low and selling high is great but maybe selling low and buying lower can also be a 'gain'? Thanks for reading!