Wash

"Wash" in financial contexts typically refers to a "wash sale," which occurs when an investor sells a security at a loss and then repurchases the same or a substantially similar security within a short period, usually 30 days. This practice is often scrutinized because it can be used to create tax advantages by realizing a loss without truly changing the investment position. Regulations prevent investors from claiming such losses for tax deductions if the wash sale rule applies, ensuring that losses are genuine reflections of an economic loss rather than strategic tax maneuvers.