Gyroscopic Investing

For the past few weeks I have been monitoring the 50/50 split between EDV and VGLT vs TLT.  In my taxable account I did a tax loss harvest and sold my TLT and bought 50/50 split between EDV and VGLT with the proceeds. Since then I have been looking at what TLT would have been as compared to the 50/50 split between EDV and VGLT. The results so far are the value is within  0 and .5 % sometimes TLT is slightly ahead and sometimes it is behind by as much as .5%.
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As of today March 1 2011 the split is 1.1% higher then TLT. Its funny that in about 30 days the value increased enough to cancel out the tax loss. Its funny I didnt really think the value would go up as much as it did so it looks like I won't switch back for the time being. I now have about 1/3 of my long term treasuary in TLT, 1/3 in EDV and 1/3 in VGLT. I may have to rebalance EDV and VGLT  every so often to keep it at the 50/50 split. The TLT I have is in a tax advantaged account so I don't touch it. Its interesting to see how this will play out.

The tax harvesting crop has indeed been fruitful over the last couple years.

Taxes are one of the few fruitful places to tinker! I feel like you have found a pretty close substitution to skirt the wash sale rule. Good job 

I have not had the portfolio long enough to rebalance but when I do I plan on selling TLT (if it is at a loss) and buying the closest thing to a 30 year that I can. I'm starting to think that buying the bonds directly will work well make tax-loss harvesting a breeze because I will just harvest the losses and buy the longest bond I can. No way the IRS can argue with that because I'm buying a bond with a greater duration.