Rounding "leftovers"
Can anyone provide some guidance on avoiding incorrect fractional shares positions that seem to arise from rounding errors in investment accounts?
In investment accounts, I frequently find that rounding causes slight mismatches in share balances shown bank/brokerage statements versus the balances shown in MD. Being a small fraction of a share off is not a big deal financially: a matter of a few cents won't change anything. But the difference does become a nuisance when I've sold off a complete position in a stock or fund but MD still things that the investment account contains a very small fractional position.
It's even more annoying when MD thinks that long closed accounts still contain tiny fractional shares of a stock or fund. Those funds still show up in reports and such. Yes,I (usually) could change the report settings, but that's just another annoyance. And if the account balances were truly zero, I could use the Toolbox extension to inactivate the, but they are not exactly zero.)
I admit that part of my annoyance comes because I used Quicken for a long time, and there it was pretty easy to adjust individual transactions on the fly so that the share balances were correct, thus removing the possibility of rounding errors. MD is not quite so cooperative.
As a kludge, I can enter dummy transactions to "buy" or "sell" fractional shares to get rid of these issues. But it would be great if there were a way to avoid them in the first place or adjust in some automated way. (And then I could adjust the cash balance in the account or create additional dummy transactions as Misc Income/Expense to a dummy Income/Expense account, which is even more kludgy.) Currently, I have a number of older accounts with these "ghost" fractional shares -- I'm trying to avoid the make-work of fixing them one by one. Any insights or advice greatly appreciated!
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1 Posted by Stuart Beesley ... on 11 Dec, 2024 08:07 PM
How are you getting fractional share holding differences? Is this because you are using splits?
2 Posted by bheck11 on 11 Dec, 2024 10:00 PM
No, it's because of buy/sell/dividend reinvestment transactions. The amount / price ends up with a "shares" value that differs in the last decimal place from what the bank/fund co. calculates.
3 Posted by Stuart Beesley ... on 11 Dec, 2024 10:05 PM
Are these manually input or downloaded from bank? If you manually enter, then you manually enter the exact qty and total?
4 Posted by dwg on 11 Dec, 2024 10:07 PM
There are three numbers involved in these transactions, the number of shares, the price per share and the total amount. The institutions will do arbitrary adjustments to these numbers in the first place.
For Moneydance it is within these three numbers you work. The question then becomes what are the most significant numbers. I would suggest it is the number of shares and the total amount, the prices per share then becomes the variable where the adjustment occurs within Moneydance. So by entering the total amount and the number of shares and allowing Moneydance to calculate the price per share you have built the adjustment into the transaction.