Which investment would you sell?

[Greg Schuricht]

Hypothetically, lets say someone wanted to liquidate some of their portfolio to finance a vacation rental down payment and furnishings.

Say he needed to raise 100K and had the following options:

Sell mutual funds that have moderate long-term capital gains?  Funds make up 75% of total portfolio, or

Sell position in one particular stock that makes up 25% of entire portfolio, but is mostly unrealized LT capital gains.  This would incur roughly a $25k tax bill.  Advantage to selling this stock would be reduction of total portfolios exposure to one stock - diversification.

Which would you sell?