I Lost $8,900 on a Clean Energy ETF. Selling It Was My Best Trade of 2025.

Gate B14, Friday, Dec 27, 2024, 4:05 pm, a two-hour-and-ten-minute delay glowing in amber on the board, and me at the bar with a suitcase between my knees and a phone that had just buzzed with the year-end statement email. I opened it between sips of a $14 airport IPA. Minus 27.9 percent, cumulative, since inception of the position. I put the phone face down on the bar, finished the beer, and made the only market decision of my holiday: whatever this position was going to be, it was not gonna be this anymore.

The position was $32,000 of a clean energy fund, snagged in eighteen monthly pieces starting January 2021, right at the sector's all-time peak, and I had averaged into it with the faith of a man who believed the calendar itself was on his side. By that Friday at gate B14 the market value was $23,100. The gap between those two numbers, $8,900, represented four years of thesis, and the thesis had been outperformed by literally leaving the money in a coffee can.

The peculiar part, the part that made me order a second beer and miss the first boarding call, was a paragraph I remembered from a tax article I had half-read in November. Losses could be useful. I sat at that bar doin the kinda arithmetic people do on napkins, and by the time zone three was called for boarding, I had talked myself into the most counterintuitive position of my investing life: the worst holding I owned was about to become the most valuable one.

January 2021, the top I did not know was the top

Everybody's fund story starts with a moment of conviction and mine arrived via a cousin at a barbecue in January 2021, describing green hydrogen the way other people describe religion. The ETF in question had returned over 140 percent the previous year, solar and grid names were on every cover, and I knew, I absolutely knew, that buying after a 140 percent year was statistically cursed, and I did it anyways with $1,500. Then another $1,500 in February, on a dip. The plan was disciplined monthly buys, eighteen of them over time, dollar-cost averaging into the energy transition the way one indexes into anything. The discipline was real. The target was simply an asset that had already had its decade, compressed into eighteen months, and mean reversion does not check whether your reasons are noble before it collects.

averaging down into a falling theme

The 2022 rate shock cut the sector in half and my monthly buys, to my lasting credit and lasting cost, kept arriving like a loyal dog. I snagged at $82 a share equivalent, then $64, then $51 through that winter, telling myself the story every averaged-down teller tells, that cheaper shares made the thesis stronger rather than the chart sadder. In 2023 I slowed, not stopped. By mid-2024, with the position down about 24 percent, I had stopped opening the monthly statement emails, and there is a specific flavor of self-protection in not looking that invariably costs more than looking.

cheaper panels, sadder chart

Thru all of it, wind and solar kept getting cheaper in the real world, installations kept rising, and the fund kept falling, because a 2021 valuation is a debt that years of good news must pay down before shareholders see a dime. The real world kept winning. My fund kept receipt of the difference, quarter after quarter, and the gap between physics improving and finance declining is the least discussed trap in thematic investing.

Jan 17, 2025, every share

I sold it all on the second Friday of 2025, at 10:41 am, from my kitchen table, in one order, before the market gave me a reason to feel clever about the timing. Grasped loss, $8,903. The confirmation screen displayed the number in a font size that read personally chosen, and I sat there and let it be what it was: four years of tuition, paid in full, receipt available. What kept me steady in the chair was the napkin from gate B14, which I had transcribed into a note with three lines on it. Line one, the loss. Line two, the gains I was sitting on in my taxable account from a rebalancing sale I had made in November, $5,900 worth, on which I owed capital gains tax. Line three, the difference I was about to not pay.

what a loss is worth at 24 percent

The mechanics deserve their paragraph because nobody teaches them til the loss already exists. The $8,900 harvested loss first offset that $5,900 of November gains dollar for dollar, which erased a tax bill of approximately $1,415 at my blended rate. The remaining $3,000 of loss applied against ordinary income, worth another $640 or so at the margin, and the code would have lemme carry forward anything left over into 2026 and beyond, tho as it happens the arithmetic used every dollar. Total tax saved, approximately $2,050, cash money, arriving as a fatter refund in a year when the position itself had paid me nothin since 2021. The loss did not make the four years good. It made them 23 percent less bad, and it converted a dead position into liquidity at the single rational moment, which is the definition of portfolio hygiene that I had previously confused with admitting defeat.

thirty-one days on the sidelines

The wash-sale rule meant I could not immediately rebuy the same or substantially identical fund and keep the loss, so I did something better than waiting, tho waiting was part of it. Thirty-one days, a calendar reminder, and then the full $23,100 went into a plain total-market index fund on Feb 21, 2025, which happened to be weeks before a spring drawdown that my old habit of averaging into weakness would have met with dread and my new habit of owning everything met with a shrug. I also turned off no dividend reinvestment anywhere, cuz there was nothing left to reinvest, and I wrote the whole sequence on one page in the notebook where I keep my market autopsies: entry thesis, exit reason, tax effect, one sentence of regret and one of relief. The regret sentence has not aged well. The relief sentence has.

gate B14, one year later

This January I was at the same airport, gate B14 again, delay board glowing amber again, and the year-end statement email arrived while I was standing in the pretzel line with a rolling bag and low expectations. New position, the boring index fund: plus 6.8 percent including dividends since that February day, and the refund containing the $2,050 had long since gone into the same fund in one lump, which felt like watching a closed loop feed itself. The fund itself, I checked once out of curiosity and against my own advice, was down another 11 percent on the year, which means my single best act as an investor remains the day I sold my worst idea at a loss, deliberately, at a bar, under a delay board. I still have the napkin folded into the notebook, soft at the creases now, numbers in ballpoint gone slightly purple with age. Worst holding. Best trade. The pretzel was better too.