BMO Changes to Mutual Funds

Terry Locke

I had a hard time finding out what happened to my BMO mutual funds in my RRSP accounts. So I needed to make a decision on how to affect this change in Quicken. If you experienced the same issue please read on and let me know what you did to overcome this issue and what you think of my solutions.

Apparently TD Waterhouse went through and swapped out (“exchanged”) all my BMO Series A Mutual funds for BMO Series D Mutual funds. This was done as a cost savings for the investor as the Series Ds have a lower MERS (some of the Series D MERS are half of what the Series A are) yet still have the same holdings (same stocks and same weight) and actually track the Series A. Or at least that’s how it was explained to me when I contacted TD Waterhouse. The thing is that unit cost is different so when swapping from the Series A to the Series D I ended up with more units at the lower cost so that the invested total remained the same. The problem in Quicken is that you can’t just go to the security and change the ticker symbol because the Series A still exists and will give you the wrong pricing for the series D. Also, someone else suggested that you just change the old GGF prefix to BMO and leave the number the same, but that won’t work because the Series A is still active and the Series Ds have new numbers.

Here is a list of the funds that I have and how they got changed:
Old Series A - New Series A - New Series D
GGF70135 - BMO70135 - BMO31135
GGF70144 - BMO70144 - BMO31144
GGF70145 - BMO70145 - BMO31145
GGF70266 - BMO70266 - BMO31266
GGF70151 - BMO70151 - BMO31151
GGF70725 - BMO70725 - BMO31725
GGF70723 - BMO70723 - BMO31723
GGF70722 - BMO70722 - BMO31722

I had a decision to make on how to handle this change in Quicken. I could either sell all the old mutual funds and then buy the new mutual funds or I could use the Stock Split transaction on the old funds and change their ticker symbol. Both methods have pros and cons.

When implementing the sell all old and buy all new method you end up with a discontinuity of fund performance as there is no history prior to November 2019 for the new funds. Also you lose sight of the actual book value of your investment and you end up with the old mutual fund series as being orphaned. Also you need to set up the Asset Class mix for every new Series D Fund you add. But this method is the cleanest for starting to track the new fund series.

When implementing the stock split method, you end up with a continuity of pricing and tracking of book value and, if you had set up the Asset Mix for the Series A then you don’t need to change it for the Series D. You will need to check the split quantities if you have more than just one account that contain these funds and you will need to adjust the share amounts (by less than .001 shares) to make it balance out to your statement. Also, as I found out, for some reason the fund prices for the old series continued into Mid-November and therefore I needed to manually adjust the 3 weeks of price history to match the new series. I was lucky to find the historical prices listed in the Globe and Mail.

I tried the two methods out on test Quicken files to see what was the best method to effect this change. So here are the procedures for both methods:

Method one, sell all the old and then buy all the new Mutual Funds. Here is what I had to do to get them into Quicken:
1. Base on my October account statements from TD Waterhouse, for each of the old series A Mutual Funds that are ‘exchanged’ I sold all the shares to cash. There are 8 of these in each of my 2 accounts so I needed to construct 16 sell transactions. Once this was done I had no BMO funds and all cash in the accounts.
2. I then needed to add in the new Mutual Funds in to the Security List:
a. Go to Tools > Security List This opens the Security List Window
b. Click the “Add Security” button at the bottom.
3. For each of the new Series D Funds I added it into my securities list one at a time and edited the security because Quicken does not have the correct information. For each of the Mutual Funds it has only one description and that is “BMO Investments Inc”. So using BMO31722 as an Example:
a. Type in BMO31722 and highlight the “Mutual:BMO31722 BMO Investments Inc”
b. Click on “Next”
c. Quicken connects to get information and displays that information in a new window. Click “Done” and it adds that Mutual Fund to your Security List.
d. In you Security List click on the newly added “BMO Investments Inc” security and the Security Detail View window pops up.
e. Click the “Edit Details” in that window and change the name to match the name in the Monthly Statement. In this case I changed it to “BMO US EQ ETF-D NL”
f. Change the currency from “U.S. Dollar” to “Canadian Dollar”
g. Change the Asset Class from “Single - Other” to “Mixture” and then defined the mixture. You can get the breakdown of the asset class mix for each fund from the BMO site
h. Uncheck the “Download Asset Class Information” That actually unchecked itself when I selected “Mixture” and “Define”
i. Click “Ok” and that returns you to Security Detail View.
j. Close that window and you get back to the Security List window.
k. On the line of the new Security find the “Download Quote” Column and check the box so that Quicken downloads the quote information.
l. Find the old security name, in this case it was “BMO US EQ ETF” and for that security uncheck the “Download Quotes” and “Watch” (if you had that checked) and then check the ‘Hide’ option. This will hide the old mutual fund from view or when you entering new transactions.
m. Repeat those 11 steps 3.a to 3.l for every one of the BMO series D Mutual Funds. Since I have 8 Series D funds so I had to do this 8 times.
4. Once I had the new Series D funds set up in my securities list, I then needed to create Buy transactions in each of 2 accounts for each of the 8 new Series D funds so I needed to create 16 buy transactions in total.
Method 1 was a lot of work to get the new Series D Funds set up and then create the 16 buy transactions. Everything seemed to work correctly but again that was a lot of work and I ended up with a discontinuity from the old series to the new series that I didn’t like.

I’ll explain Method 2 in my next segment

Terry Locke

Continuing from segment 1:

Method two, use the Stock Split transaction to introduce the new BMO Series D Mutual Funds. This is the method I used on my live account after testing it on a test Quicken File. Here is what I did to get this to work in Quicken:
1. Click on Tools > Security List.
2. Look for a BMO fund (for example the “BMO US EQ ETF “ GGF70722) and click on the security to launch the Security Detail View and make the following changes:
a. Left click in the price graph and select “Price History” in the options to popup the Price History table. Select all the prices that are newer than the exchange date (my exchange date was October 18 and the prices in the table went out to November 5). With those prices selected click the “delete” to delete those price entries.
b. Click on “Edit Details”
c. Change the name to “BMO US EQ ETF-D NL”
d. Change the Symbol to “BMO31722”
e. Check the Asset Mix by clicking on “Define” and verify that the mix is as described in the BMO Fund prospectus downloaded from BMO. Since I had setup this mix when it was the old Series A, the mix was still valid.
f. Click “OK” and you will get a popup window that sates “Symbol Change Affects Price History”. Select the “Merge Quotes from …..” option and click “OK”
g. That will return you to the Security Detail View and you should check that the changes you made are correct then click the “Update”
h. If you have more funds to work on you can select it by either using the drop down in the upper left of the Security Detail View window or close the detail view and go back to the Security List window and select the next BMO Fund in your list and repeat Steps a. to g. for all of the Series A funds that were exchanged for Series D funds.
3. When you have completed updating all the BMO funds to the new name and symbol in step 2, go to the Security List window and make sure that “Download Quotes” is checked for all the updated funds. Now you are ready to create the split transactions.
4. Select an account that has the BMO funds that you need to ‘exchange’ to the new BMO funds.
5. In the account window select “Enter Transactions” to popup the Transaction window. Next, select Stock Split from the dropdown.
a. Adjust the transaction date to the day of the ‘Exchange’. In my case that is October 18 2019
b. Select the Security Name from the dropdown to be one of the BMO Mutual funds For example I selected “BMO US EQ ETF-D NL”
c. Enter the New Shares quantity, this is the number of shares of the new Series D I received into the account.
d. Enter the Old Shares quantity, this is the number of shares of the old Series A “BMO US EQ ETF “ that were removed from the account
e. Do not enter the “Price after the split”, leave it blank.
f. Enter a note into the Memo. Something like “Used Stock Split for exchange of funds”
g. Click either “Enter Done” if you are finished all the Mutual Funds or “Enter New” if you have more splits to enter. Repeat steps a. to g. for each of the funds.
h. When you add this Stock Split transaction in one of the accounts it will reflect in other accounts with the same BMO Funds. In my case I have two accounts with these funds in them.
6. When you have completed entering all the splits, click on the ‘Investing’ tab and in the “Update” dropdown select “Historical Prices” and select ‘Get Prices for the Last” select “Year” and then click “Update Now”. This will update all historical pricing for the new series.
7. Next you need to check to make sure that the historical prices are correct. I found that for some reason the pricing was not correct for about 21 days after the ‘exchange’ date. I had deleted the price history in step 2 above since the prices were wrong for the Series D but the price update from Quicken did not populate the Series D prices for that time span and left it blank. I decided not to manually populate those historical prices since Quicken adjusted the prices according to the stock split. If I had decided to manually update those historical prices I would have done this:
a. Go to the web and type in the Ticker Symbol for one of the new Series D funds and you will find several resources for the historical pricing. I selected the Globe and Mail as the had a button that showed past pricing for the last year and allowed me to select the start date and end date for viewing the prices.
b. From the Investing tab window in Quicken, click on one of the BMO funds to popup the Security Detail View window. Make sure that the “Split adjust” is checked for the pricing. If you had not cleared the historic pricing as I did in Step 2 you should see a spike in pricing starting on the date of the exchange (Stock Split) and continuing into November. Right click in the price graph area.
c. In the action popup select “Price History” to popup the Price History table
d. Scroll down the table to find the pricing starting at the exchange date (in my case that would be October 18, 2019).
e. If you had cleared the pricing in step 2, you should see no pricing entered for the dates between October 18 and November 4. In this case you would need to add pricing by clicking the “New” button to get the “New Pricing For….” Popup. Enter the date for the pricing and then enter the prices “Price”, “High”, “Low” then click “Ok”
f. If you had not cleared the pricing in Step 2 what you would see is pricing for the old series A from that October date out to sometime in November. Select the pricing on the date of the exchange and click “Edit”. Change the price to the price as given in the Globe and Mail site for that date and click OK to change that price in the table. Repeat this for every date that you see incorrect pricing until you reach the date where the real Series D pricing was downloaded by Quicken. As you do this you will notice the spike in the Price graph will diminish for each price you change. When there is no more spike you are done with that fund.
g. Repeat steps a to f for every BMO Series D fund you have in your accounts. I had to do this for 8 funds.
8. You then need to verify that the numbers of shares are correct and match your statement. Keep in mind that when you enter a Stock Split transaction and the numbers of old shares and new shares, what you are telling Quicken is the ratio of the split and Quicken uses that ratio to calculate the number of share for the new funds. This calculation will not yield an exact number that matches to your statement and it will be out by a very small fraction.
a. In the account register window, Click the “Holdings” button to popup the Account Overview window.
b. Select the last day of the month of the fund ‘exchange’. In my case that would be October 31, 2019
c. Compare the numbers of shares in the Account Overview window to your account statement from your financial institution. In this case my statement showed that there was a Security Position Adjustment for several of the funds. Calculate the difference between the number of shares as shown in your statement vs what is showing in Quicken.
d. Click “Enter Transaction” and use the “Add Shares” or “Remove Shares” transaction to adjust the shares in Quicken to match those in your statement. Make sure you select the correct date for this transaction. In my case that would be October 31, 2019. In my case I had to subtract .003 shares of a fund to make it all balance out.
e. For each fund in the account, repeat steps a to d in order to make your holdings match in that account.
f. Select the next account and repeat steps a to e in order to make your holdings in Quicken match your holdings in your statement.
Method 2 is also a lot of work but I feel that it better reflects the continuity of pricing for the BMO funds and it preserves the “Book Value” of the original investment.

Let me know what you think.

Jim_Harman

Normally the way to record this in Quicken would be to click on Enter transactions and select the Mutual Fund Conversion macro transaction. This will create one Removed transaction for your old class and an Added transaction for each tax lot in the new class.

Note that this does not work correctly if you have set the security to "Use average cost"

Terry Locke

@Jim_Harman Thanks. I never saw that option. It looks like it is the easiest way to do it but it has problems.

First off Quicken has set up the new BMO funds as US currency, not in Canadian Currency. So I can't use Fund Conversion directly as these are Canadian dollar funds in a Canadian account and I get a Quicken Error telling me that the Security does not match the currency of the account. Secondly, Quicken has a generic descriptor of "BMO Investment Inc" for everyone of the new BMO funds.

So I guess I need to first set up all the new Funds by adding them into my security list and edit them as I did in Method 1 above with the following steps:

2. I then needed to add in the new Mutual Funds in to the Security List:
a. Go to Tools > Security List This opens the Security List Window
b. Click the “Add Security” button at the bottom.
3. For each of the new Series D Funds I added it into my securities list one at a time and edited the security because Quicken does not have the correct information. For each of the Mutual Funds it has only one description and that is “BMO Investments Inc”. So using BMO31722 as an Example:
a. Type in BMO31722 and highlight the “Mutual:BMO31722 BMO Investments Inc”
b. Click on “Next”
c. Quicken connects to get information and displays that information in a new window. Click “Done” and it adds that Mutual Fund to your Security List.
d. In you Security List click on the newly added “BMO Investments Inc” security and the Security Detail View window pops up.
e. Click the “Edit Details” in that window and change the name to match the name in the Monthly Statement. In this case I changed it to “BMO US EQ ETF-D NL”
f. Change the currency from “U.S. Dollar” to “Canadian Dollar”
g. Change the Asset Class from “Single - Other” to “Mixture” and then defined the mixture. You can get the breakdown of the asset class mix for each fund from the BMO site
h. Uncheck the “Download Asset Class Information” That actually unchecked itself when I selected “Mixture” and “Define”
i. Click “Ok” and that returns you to Security Detail View.
j. Close that window and you get back to the Security List window.
k. On the line of the new Security find the “Download Quote” Column and check the box so that Quicken downloads the quote information.
l. Find the old security name, in this case it was “BMO US EQ ETF” and for that security uncheck the “Download Quotes” and “Watch” (if you had that checked) and then check the ‘Hide’ option. This will hide the old mutual fund from view or when you entering new transactions.

Once that is done I should be able to use the Fund Conversion method

And I tried that but something is way off. It removed all the old shares and then produced 25 transactions of adding the new shares for each of the new funds and the pricing is way off and I have lost all sense of continuity from the old to the new funds as I can only see the history from October 18 to now plus my book value is all screwed up. That is 25 transactions for each of the 8 funds so 200 new transactions.

So this is not a good option.

alaston

I have several TD funds (like TDB911 or TDB911C). I can't change the currency from U.S.$ to Canadian$ (grayed out) so my Net Worth calcs are skewed by the dollar differences between the countries. I can't Delete either of these presumably because they're in use. Suggestions?