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Investment performance showing incomplete data

Chris Sowerby

I just realized that relevant transactions and/or securities are being omitted when I run an Investment Performance report! For example if I run the report for my non-registered investment account with all Securities, Security Types and Investing Goals selected, I see no entries for one specific security. If I then clear the Securities list and select just that one security, it now appears in the report. However even then, some dividend reinvestment transactions are not included in the calculation. This makes the report very misleading and untrustworty, and could lead to bad investment decisions.

For the hefty subscription amount I now pay for this software, I expect it to do this basic calculation flawlessly.

Quicken Canada 2019 Home & Business, R15.24 on Windows 10 desktop

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Comments

Tom Young

"However even then, some dividend reinvestment transactions are not included in the calculation."

This has been discussed many times in here, and not seeing the dividend reinvestment transactions, while confusing, is perfectly fine for the calculation itself. The calculation depends on cash flows for each day in the period specified and a dividend reinvestment has both an outflow (dividend) and inflow (buy) on the same day, effectively making the net cash for for that day $0.

If the security in question has only ReinDiv transactions the you won't see anything in the Investment Performance report that makes it clear that the security is being included. To make that conclusion you have to look at the composition of the beginning and ending balances. Maybe that's what you're seeing here?

Jim_Harman

Dividend reinvestments where the dividend and the purchase were in the same day do not have a separate entry in the investing performance report because the return and the new investment are the same amount. They affect the performance correctly because you have more shares at the end of the period.

Jim_Harman

"However even then, some dividend reinvestment transactions are not included in the calculation."

This has been discussed many times in here, and not seeing the dividend reinvestment transactions, while confusing, is perfectly fine for the calculation itself. The calculation depends on cash flows for each day in the period specified and a dividend reinvestment has both an outflow (dividend) and inflow (buy) on the same day, effectively making the net cash for for that day $0.

If the security in question has only ReinDiv transactions the you won't see anything in the Investment Performance report that makes it clear that the security is being included. To make that conclusion you have to look at the composition of the beginning and ending balances. Maybe that's what you're seeing here?

To see if the security is really not included, try removing just that security from the report. You should see that the IRR changes.

Chris Sowerby

Thanks - I was about to update my post because I had just realized that the reinvested dividends don't need to show up in this report. I was confused by the fact that they do appear when securities are transferred from one account to the other, because they then form part of the cost basis.

My original question still stands though - how can a security not appear in the list when all securities are selected, but then show up when it is selected on its own? I just did another check, and the missing security does appear when the report is sorted by security but not when it's sorted by account. In fact the dividing line seems to be between Account and Security in the sort criteria list - selecting any criteria at the top of the list will suppress certain securities but the criteria from Security on down allow them to appear. To quantify the problem, 3 of 9 securities held in the account are disappearing and for the ones that aren't suppressed, a total of 7 valid transactions don't show up, when the sort criterion is changed to Account. Quite mysterious!

Chris Sowerby

"However even then, some dividend reinvestment transactions are not included in the calculation."

This has been discussed many times in here, and not seeing the dividend reinvestment transactions, while confusing, is perfectly fine for the calculation itself. The calculation depends on cash flows for each day in the period specified and a dividend reinvestment has both an outflow (dividend) and inflow (buy) on the same day, effectively making the net cash for for that day $0.

If the security in question has only ReinDiv transactions the you won't see anything in the Investment Performance report that makes it clear that the security is being included. To make that conclusion you have to look at the composition of the beginning and ending balances. Maybe that's what you're seeing here?

Good point. Yes, the IRR does change but from my previous comment that makes sense since the missing security is listed when sort criteria change. So now the question becomes - why do certain securities and some transactions get omitted from the summary when sorted by account?

Jim_Harman

If you had no buys or sells, only reinvested dividends during the analysis period and you sort by account, it is showing you account level performance and the security will not appear in the report.

Chris Sowerby

Nope, the missing transactions are all buys, sells or cash dividends. As I mentioned in an earlier comment, everything appears correctly when sorted by security but some data gets suppressed when sorted by account or a time criterion.

q_lurker

Nope, the missing transactions are all buys, sells or cash dividends. As I mentioned in an earlier comment, everything appears correctly when sorted by security but some data gets suppressed when sorted by account or a time criterion.

You keep saying that transactions and/or securities are missing from the report. Yet the report does not list securities and does not intend to list all transactions. Something seems amiss in your description.

I will also point to a character of the IPR - that is, an applicable transaction is listed as a return if it is a removal from that sub-total. So when subtotaled by security, a Dividend transaction will be listed in the IPR under that security. For the same transaction when the IPR is subtotaled by Account, the dividend will not be listed.

That is not saying that the transaction is missed when subtotaled by Account. For that subtotal, the dividend is a change in form - from value as part of the security to value as cash. Since the cash is still part of the account, the dividend payment does not represent 'return' at the account level. The positive nature of the dividend is still felt since the overall ending value of the account is increased by the dividend (even though the security value might have dropped similarly).

Perhaps it is then obvious that DivX and similar that remove the paid dividend from the account would be listed as transactions when subtotaled by account.

That characteristic would not seem to apply within the time-criterion setting where the 'investment' / 'return' consideration would still be at the upper level.

I am not seeing you basis for missing transactions and securities. I think there is some other discrepancy in your data.

Chris Sowerby

Thanks for the insight provided in replies to my original post. I have taken a closer look at the types of transactions included with the different sorting criteria, and realized that everything is being taken into account correctly. I discovered that certain transaction types such as buys, sells, interest and cash dividend income are not itemized when the report is sorted by account. Adds, removes and return of capital always appear regardless how the report is sorted. This now makes sense - unless cash or securities are transferred in or out of the account as part of a transaction, the IRR doesn't change at the account level because the timing of those transactions is not significant for IRR calculation and the value just remains in the account ending total amount regardless what form it is in. However those transactions do appear when summarized by security because they have to be considered in IRR at the individual security level. The reason that some securities were disappearing from my report when it was sorted by account is that those securities only had buy, sell and/or dividend transactions. It's a confusing situation and I am feeling greatly relieved now that it's resolved!

Jim_Harman

Thanks for the insight provided in replies to my original post. I have taken a closer look at the types of transactions included with the different sorting criteria, and realized that everything is being taken into account correctly. I discovered that certain transaction types such as buys, sells, interest and cash dividend income are not itemized when the report is sorted by account. Adds, removes and return of capital always appear regardless how the report is sorted. This now makes sense - unless cash or securities are transferred in or out of the account as part of a transaction, the IRR doesn't change at the account level because the timing of those transactions is not significant for IRR calculation and the value just remains in the account ending total amount regardless what form it is in. However those transactions do appear when summarized by security because they have to be considered in IRR at the individual security level. The reason that some securities were disappearing from my report when it was sorted by account is that those securities only had buy, sell and/or dividend transactions. It's a confusing situation and I am feeling greatly relieved now that it's resolved!

Right. You can think of subtotaling as drawing a circle around each subtotaled item. Only transactions that cross that boundary will appear in the report.