How do I merge three mutual funds into a new fund?

Ben45

I have multiple mutual funds with one company. They moved three funds into a fourth one that I do not have in my securities list. How do I accomplish this?

Frankx

Hi again @Ben45

It is likely that these changes will be deemed to be a tax-free exchange (you should receive information from the fund company about this) which means that you won't incur any tax consequences from the exchange of your old funds for the new fund.  In addition, your "cost basis" (basically what you paid for the original three funds plus any reinvestments) will be carried over to your investment in the new fund.

Quicken handles these types pretty well (at least that's been my experience with Quicken).  The transaction type that you will need to do in Quicken is a "Mutual Fund Conversion" and unfortunately, you'll need to do it three times (once for each of the old mutual funds).  It is pretty straightforward, you'll need to enter the names of the old fund(s), the name of the new fund, the number of shares you received of the new fund and the price per share of the new fund immediately after the conversion.

The tricky part will likely be figuring out the number of new fund shares that were received for each one of the old funds (let's call it the "new shares number") - because, as I mentioned above - in Quicken you need to initiate the "Mutual Fund Conversion" process in Quicken three times.  This information may be presented in the data provided by the fund company concerning these transactions.  While I've never had a conversion where three funds were simultaneously rolled into another fund, I suspect that as long as you can approximate the "new shares number" you still will be okay as long as the total number of new shares in Quicken after the conversion agrees with your mutual fund statement immediately after the conversion.

Let me know if you have any followups.

Frankx 

Ps56k2

Could you share what they are ....

Don't think I have seen where a company has "moved" mutual funds...
Sometimes they might "merge" - which should have a normal set of transactions to reflect the new fund and new shares.

I guess it comes down to... what exactly happened in the real world that you want Quicken to also reflect in the Quicken accounts.

Frankx

Hi @Ben45,

I assume that you've been using Quicken to track the "three funds", and you have one Quicken account that holds investments in those 3 funds.  Was the switch simply a matter of you wanting to move out of the 3 funds and into the new one, or did the fund company shut down those three funds and move you into the new one?

Frankx

Tom Young

Just to be clear, this is not a situation where you sold three mutual funds and then bought a fourth mutual fund with the proceeds, right?
Instead, all your shares in the three old funds disappeared in a tax free exchange and you received some number of shares of a fourth fund?  Were the exchanges 1 for 1 or did you end up with a different number of shares.
It might help to disclose the names of the funds involved.

Ben45

Frankx - The fund company shut down the three funds ( a core fund, a growth fund, and a value fund) and moved everything from those funds into their large cap fund.
Tom Young - See above.
ps56k - See above

NotACPA

@Ben45, PLEASE name the specific funds ... so that we can properly research the issue.

Frankx

Hi again @Ben45

It is likely that these changes will be deemed to be a tax-free exchange (you should receive information from the fund company about this) which means that you won't incur any tax consequences from the exchange of your old funds for the new fund.  In addition, your "cost basis" (basically what you paid for the original three funds plus any reinvestments) will be carried over to your investment in the new fund.

Quicken handles these types pretty well (at least that's been my experience with Quicken).  The transaction type that you will need to do in Quicken is a "Mutual Fund Conversion" and unfortunately, you'll need to do it three times (once for each of the old mutual funds).  It is pretty straightforward, you'll need to enter the names of the old fund(s), the name of the new fund, the number of shares you received of the new fund and the price per share of the new fund immediately after the conversion.

The tricky part will likely be figuring out the number of new fund shares that were received for each one of the old funds (let's call it the "new shares number") - because, as I mentioned above - in Quicken you need to initiate the "Mutual Fund Conversion" process in Quicken three times.  This information may be presented in the data provided by the fund company concerning these transactions.  While I've never had a conversion where three funds were simultaneously rolled into another fund, I suspect that as long as you can approximate the "new shares number" you still will be okay as long as the total number of new shares in Quicken after the conversion agrees with your mutual fund statement immediately after the conversion.

Let me know if you have any followups.

Frankx