Though I don’t implement the strategy on my own, I know many people and that robo-advisors use the idea of selling VOO and buying SPY and vice versa when they are down on their position since they both are S&P 500 etfs. I also know that both have more than ample liquidity and do to the slightly lower expense ratio, VOO is often the better long-term choice for people buying and holding while SPY has more options liquidity so it is better for options/ option-equity investing and trading.
Besides all of that, I was wondering if robo-advisors simply wait till a certain point to sell VOO and buy SPY or the other way around, or do they simply do it in a fraction of a second constantly switching between the two so that the short-term capital gains tax of 37.5% roughly (my bracket) is imposed or in other words you only receive 62.5% of my losses on a tax basis assuming I have other taxable income/gains of course?
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