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Fidelity Merger

Fidelity has created a merger entry with the total of all my shares in my mutual fund and that has caused the cost basis to be way off. How do I fix the cost basis? Why does Fidelity do and in and out of all my shares like that?

Comments

  • NotACPA
    NotACPA SuperUser, Windows Beta Beta
    What funds?  And, besides being a SuperUser here, I'm also in Fidelity's "Private Client Group".
    Q user since DOS version 5
    Now running Quicken Windows Subscription,  Home & Business
    Retired "Certified Information Systems Auditor" & Bank Audit VP
  • bee9
    bee9 Member
    Its FXAIX and it's in my 401k Brokerage Account.
  • NotACPA
    NotACPA SuperUser, Windows Beta Beta
    OK, so this was part of Fidelity's actions on November 2nd and 9th of last year to collapse multiple fund classes into a single class.
    Since these are in a retirement account, I'd just record the sum of the cost basis of all of the old classes, a "Shares Removed" of the old funds and an ADD of the new fund/class with the cost basis determined before.  This was a non-taxable transaction (even in non-retirement accounts).
    And, according to "Fidelity Monitor and Insight", "the consolidations are a plus because they have resulted in slightly reduced fees for the retail investors and a much more simplified lineup of index fund offerings"
    Q user since DOS version 5
    Now running Quicken Windows Subscription,  Home & Business
    Retired "Certified Information Systems Auditor" & Bank Audit VP
  • bee9
    bee9 Member
    Ok, thank you so much.
  • Sherlock
    Sherlock SuperUser ✭✭✭✭✭
    edited May 2019
    Fidelity provided the following explanation for their planned fund mergers in December 2018: https://www.fidelity.com/bin-public/060_www_fidelity_com/documents/mutual-funds/Fidelity-lower-expense-ratios-index-mf_FAQs.pdf

    I suggest you replace the inappropriate transactions with the transactions generated using the Corporate Acquisition (stock for stock) wizard.


  • NotACPA
    NotACPA SuperUser, Windows Beta Beta
    @Sherlock the problem with using CorpAcq is that the ratios are really screwy.
    And since the OP's funds are in a Retirement account, I found that Remove and Add to just be simpler.
    Also, while your PDF provides a wealth of info ... it doesn't include those ratios.
    Q user since DOS version 5
    Now running Quicken Windows Subscription,  Home & Business
    Retired "Certified Information Systems Auditor" & Bank Audit VP
  • Sherlock
    Sherlock SuperUser ✭✭✭✭✭
    edited May 2019
    NotACPA said:
    @Sherlock the problem with using CorpAcq is that the ratios are really screwy.
    And since the OP's funds are in a Retirement account, I found that Remove and Add to just be simpler.
    Also, while your PDF provides a wealth of info ... it doesn't include those ratios.
    @NotACPA I have never had any problems with CorpAcq.  It has been the Mutual Fund Conversion wizard that has been screwy.

    With regard to performing an Removed and Added being simpler for a retirement account, I agree, but I'm not convinced the average Quicken user would.

    Also, the PDF is Fidelity's wealth of info not mine.  It you use the CorpAcq wizard you do not need to know those ratios just the number of shares.
  • bee9
    bee9 Member
    Thank you so much for that info, very helpful
This discussion has been closed.