Amount Invested in a stock

Learning

Using Quicken 2011 here.

example:

Bought 10 shares at $10 for $100 total
Sold 5 of those shares at $20 for $100 total

Quicken shows a cost basis of $50 I understand that.

Is there a way to show/see that this stock is stock that I have none of my own money in?

I will have 5 shares in the account that i effectively paid nothing to own.

Currently having the market value beside the cost basis looks misleading when look at this type of situation.

Mark1104

it's not misleading.  it's the way it works.  

Let's say you sold the remaining 5 shares today and re-purchased them tomorrow at the same price.   Would you now say you again playing with your own money and not 'house money'? You effectively paid $100 to buy those shares back! what changed?  Your economic condition is exactly the same tomorrow as it is today!

A better way to think about it is review the 'annual return' of your investment.  Under "reports", run the investment performance report. look at the average annual return

Consider that money in a bank savings account has a return of let's say .5% in today's environment.   Are you getting a return high enough for the risk you are taking with this investment vs. a risk free investment (bank deposit or treasury bonds). 

Learning

Well no, I originally started with $100.. So cashing everything out my economic condition has changed since I now have $200. I can take my original $100 and deploy the created $100 again rinse and repeat. By cashing out the $100 I ensure that at the least I break even, since my economic value will always remain above $100 in the overall deal. Hence being able to see that easily that I have no money in the deal and it's all positive.

For me I differentiate between money I spend time earning, and money that is made for me by money working without my time.

So in this case the intial $100 I deployed is money that I have earned. I put it to work and now that money has grown enough that I can take out that inital $100 and I don't really care how high the remaining stocks go because I now have my initial $100 and those stocks are free essentially.

I can take my $100 and deploy it elsewhere rinse and repeat at the end of the day I'm left with $100 plus these other assets that the initial $100 created for me.

This is mainly for when the investment has doubled tripled etc.. I have no problem with how Quicken reports it. I was just wondering if there was an easier way to see that I paid $100 intially and cashed out $100 so I essentially have zero original money in the deal, and still have assets worth x amount.

Hopefully I'm making some sense.

Thanks!

Mark1104

You could always do a RTNCAP transaction to eliminate the cost basis .... 

Learning

Awesome! I'll look that up thanks!

Ps56k2

Learning said:  This is mainly for when the investment has doubled tripled etc.. I have no problem with how Quicken reports it. I was just wondering if there was an easier way to see that I paid $100 intially and cashed out $100 so I essentially have zero original money in the deal, and still have assets worth x amount.

Well, you can play "casino" all you want,

but in the real world - the IRS looks at it in a totally different manner,

as do most investors, brokerage houses, and financial advisors.

NotACPA

From your sale of 5 shares, you have $50 "return of capital" (that which you originally paid for the shares) and $50 Capital Gain.  This CapGain is reportable to the IRS on your return for the year of the sale.

You still have the $50 basis in the 5 shares not originally sold.  When you sell these 5 shares you MIGHT have another CapGain, you MIGHT have a CapLoss and you MIGHT come our even.

BUT, from an accounting viewpoint, you still have a $50 basis in the 5 shares not sold ... NOT a $0 basis. IF you had a $0 basis, then EVERYTHING that you receive when you sold those 5 shares would be a CapGain.