Investment Account Understanding

dharr's Avatar

dharr

12 Jul, 2020 12:47 PM

Transferring from Quicken 2000 (UK) (used Quicken for 24years), setup and posted transactions with the help of the knowledge base and discussions, really impressed with Moneydance.

I have a query creating my share holding. I have various shares with a broker have money sterling and euro accounts with money in.

My understanding is in Moneydance "Investment Accounts" holds your shares information and their transactions but can also hold the balance of cash held by the broker. Therefore you would create an "Investment Account" for an individual broker. Is this right ? and if so can it manage having both sterling and euro shares and receiving dividends in both currencies ?

Can you do reconciliation of the monies held by the broker in both currencies, they should it as two different "cash accounts" ?

I only have one euro share, is it easier/better to create either the euro brokers "cash account" or both the euro and sterling "cash accounts as either assets or bank accounts and just show buying and selling in the Investment Account posting the funding to those asset/bank accounts ?

I've done a few test posts and find the Register and the Bank Register Screens confusing, could someone explain the difference and what each shows.

Many thanks, Duncan

  1. 1 Posted by dwg on 12 Jul, 2020 09:27 PM

    dwg's Avatar

    I'm a fellow user.

    Yes you can have cash in a brokerage account in Moneydance, I have routinely done this. Some brokers hold the Moneydance in a Money Market investment and I have seen users set up a Money Market investment for this - sometimes the determining factor is how the brokers present the transaction in downloads.

    An account can only be in a single currency. This is the level that Moneydance is handling different currencies at. I do not see a way it could comfortable handle mixed currencies in an account, it would have to somehow do sub accounts and sub registers I feel and that is likely to just add complexity.

    The main register for an Investment account is the Register. The Bank Register is present to facilitate the entry of bank type transactions e.g. splits, check writing, foreign currency transfers that you would not normally do in Investment accounts (and which the register has no provision for) but where an investment house has provided banking type function for a cash account in an Investment. So this register is therefore just a way to enter such transactions it has no other use.

    The bank register will not show all transactions as it does not understand them and the Register will show many banking transactions as just xfr type transactions if memory serves.

  2. 2 Posted by dharr on 13 Jul, 2020 09:50 AM

    dharr's Avatar

    Hi dwg
    Thank you very much for your time explaining how investment account works, it's a lot clear now.
    I can see why having two different currencies "cash accounts" in one investment account would be pretty difficult and confusing. I think I'll actually set both the sterling and euro broker "cash accounts" as separate assets then buy and sell from them This seems simpler and also it appears if you have cash in the investment account the total balance showing on the lefthand sidebar includes both shares and cash, I would prefer to see them separate. Would this work ok ?
    Entering current share holding - I've entered a"Buy" transaction in the register being the date and price of original purchase then edited the investment account balance to that cost and that seems to balance out correctly (only done one share so far), is that an ok way of entering current share holding ?
    Other question, can you have different share currencies in the one investment account ? I see when you create the price of the share you can set the currency.
    Sorry for so many questions, thought I was doing so well till I got setting up investments!! Again many thanks, very helpful.

  3. 3 Posted by dwg on 13 Jul, 2020 11:20 AM

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    Investment by their very nature make for the most complex of accounts.

    Yes any cash balances in the Investment account will get added into the total value of the investment account. In my case I have a linked bank account that is tied into my investments and that gets used for the drawing or deposit of funds from investment transactions and that has worked for me. I would tend not to use BuyXfr or SellXfr transactions however, I would split them into their separate components i.e. a Xfr and a Buy or a sell then a Xfr.

    For your current shareholding entering the purchases at cost price then using the Initial Balance field under Account info to provide the cash for these purchases is one of the accepted methods of setting up the initial holdings, there are multiple methods, but this is one of the tidiest.

    There is no provision to set a currency on a security in the investment account so my understanding is that it inherits the currency of the account. If the currency of the downloaded prices is different, I do not know what the outcome will be, it is not something I have ever tried.

  4. 4 Posted by dharr on 13 Jul, 2020 04:43 PM

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    Again thanks for your help.
    I'm the same have a linked bank account with my brokers funding and holding deposit for my dealings, having both euro and sterling accounts complicates matters but with your explanations I'm now confident how I can deal with this.

    With regard to currency on securities, as you say creating a doesn't' have any reference to currency but I notice that entering prices you can choose the currency and if you already have a price in say GBP if you then change the currency to say Euro it converts the previous prices. Don't know the implications both with the individual security or the investment account if you have different securities currencies within the same account. I appreciate you don't have this situation and you have been very helpful already so I'll play with this in my test account set and post back here when I've worked it out for others if they have the same situation. Or I might just sell my euro securities and make the problem go away !! lol

    Again thanks for your help, seems great software and a helpful community if you are anything to go by.
    Best regards, Duncan

  5. dharr closed this discussion on 16 Jul, 2020 11:46 AM.

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