Shares transferred between accounts

Gary R

Back in January and February of this year, I transferred all my shares in Vanguard and T. Rowe Price to Fidelity. I just looked at my Quicken portfolio, group by account, Year to date returns, and they are way off from the Investment Performance returns Year to date.
WE're talking about tens of thousands of dollars. However, the final YTD returns are only off by a few thousand dollars when you don't group by account and just show bottom numbers

Tom Young

Shares Transferred Between Accounts only moves your security lots from one Account to another Account, it doesn't transfer transactions prior to the date of transfer into the new Account.  Those transactions - and the resulting positions up to the transfer date - stay in the "from" Account.

Accordingly, with a grouping by Accounts all you're seeing is the activities and changes in value that occurred from the transfer date to present in that Account, you're not getting a true year to date performance figure for the securities themselves.  For that you'd either have to include the old "from" Accounts if running an Investment Performance Report, or group by security on the Portfolio view.

Jim_Harman

Please give the exact name of the Portfolio column you are referring to. There are several similarly named columns and they will give different results in the situation you describe.

Also when you transferred the shares in Quicken, did you use Quicken's Shares Transferred between Accounts, or did you accept the downloaded Removed and Added transactions?

q_lurker

This is likely supporting the other two comments.  I think what you are seeing is normal behavior.  I have used Shares Transferred fairly often over the years and did so on Jan 1 this year.  An example (in Round numbers).

Bought a security for $9,000
By end of year 12/31/20 had appreciated to $12,000
Gain/Loss = Return $ = $3000
Shares Transferred on 1/1/21
Value is still 12,000
Gain/Loss is still $3,000
Return $ (lifetime) is still $3,000
By account
Return $ of this security in old account is $0
Return $ of this security in new account is +$3000
Return $ YTD in old account is -$3,000
Return $ YTD in new account is +$3,000


With respect to the old account, the shares removed were removed at their cost basis.  Since they began the new year in the old account at the $12,000 valuation and were removed valued at $9,000 that is a $3000 'loss' or negative return for this year.   

For the new account, the shares were added at their cost basis ($9000) and ended 1/1/21 at the $12,000 valuation - an immediate Return of $3,000 even though there was no price change from 12/31 to 1/1.  

Viewed as a whole, there should be no net difference in return$ across the shares transferred date.  But viewed at an account level, there can be.  

Return $ then feed into ROI% figures in mostly direct ways.  However the denominator of that %-age (Amount Invested) will be adversely affected by the Remove/Add pairing.  That is, the new Add Shares in the new account adds to the Amount Invested, but the Remove side of the transactions does not subtract from the Amount Invested.  In my example above, the Amount Invested viewed by Account will show the $9,000 in the old account before the transfer, and will sow the $9,000 in the new account after the transfer.  But when viewed by security, the Amount Invested will jump from $9,000 before the transfer to $18,000 after the transfer.

Generally speaking, I find the Average Annual Return calculation presented in portfolio views or through the Investment Performance Report to be more bullet-proof to such transactions and more reliable and consistent measures of performance -- Not fool proof, but better.  

Chris_QPW

As it turns out I'm in the process of moving my investments in Vanguard to JP Morgan Chase, so I was looking at this very subject and thought I would throw out my observations. Which line up what with the others have said, but maybe in a slightly different way that might be easier for some people to understand (like me  ).

These are the fields that I normally look at, each have value in different situations/securities.


When transferring shares between accounts there are three basic columns that are affected (other columns use these for their calculations).
Cost Basis, Income, Avg Annual Return.

If one uses Add Shares and doesn't put in the correct Cost Basis this will of course be off.  Quicken's Shares Transferred Between Accounts puts in an Add Shares for every security lot with the correct cost basis and the acquired date.  This takes care of the cost basis tax ramifications.

The Income column is keeping track of all the dividends/interest paid for the security.  Since Quicken's Shares Transferred Between Accounts doesn't reproduce these dividends/interest transactions, this column will be zero for these shares that are transferred.  When I think of all the complications of trying to connect what shares gave you what dividends and such, I'm not surprised that they didn't tackle this problem.

That leaves the Avg Annual Return.  When I did this I was a bit surprised that this number went to zero after using Shares Transferred Between Accounts.  After all they put in all the acquired dates in the Add Shares.  As it turns out though Avg Annual Return is using the transaction date, and not considering the cost basis date.  Since I set the date for this transfer to 9/10/2021 all the Add Share transactions got that date, and as such as far as Quicken is concerned for the Avg Annual Return I haven't even held any share for YTD let alone one or 5 years.

As a test I did the Shares Transferred Between Accounts using 1/1/2021 as the date, and sure enough all the Avg Annual Return YTD was shown, and was correct (it also used it for 1 and 5 year, which isn't really correct).

So what does one have to do to actually get these numbers to transfer?
I think the basic answer is that you have to move (or reproduce) all of the transactions that are really involved.

There isn't any way this can be done where the "real history" is used.

If the entire account is transferred then one approach is simply deactivate the account from downloading from the first financial institution and reactivate it on the second financial institution.  And remove any duplicate transactions created when first downloading from the second financial institution.

This of course gets rid of "real history" that some transactions were in fact from the first financial institution, but it does get the numbers to be correct.

Another variation on this is first archive the old lots in the old account, and then move the remaining transactions to the new account (removing duplicate transaction from the first download of the second account).

For partial transfers it is really going to be hard to get this right (probably the main reason that Quicken doesn't do it for you).

Jim_Harman

Chris_QPW said:

So what does one have to do to actually get these numbers to transfer?
I think the basic answer is that you have to move (or reproduce) all of the transactions that are really involved.

There isn't any way this can be done where the "real history" is used.

You are looking at the Average Annual Return (IRR) when the when the portfolio view is grouped by account. If you include just the affected accounts, the total return at the bottom of the view should be correct for the period selected, and If you group the view by security, the total IRR should also be correct. 

Chris_QPW

Jim_Harman said:

Chris_QPW said:

So what does one have to do to actually get these numbers to transfer?
I think the basic answer is that you have to move (or reproduce) all of the transactions that are really involved.

There isn't any way this can be done where the "real history" is used.

You are looking at the Average Annual Return (IRR) when the when the portfolio view is grouped by account. If you include just the affected accounts, the total return at the bottom of the view should be correct for the period selected, and If you group the view by security, the total IRR should also be correct. 

That isn't what I'm seeing.  Here new account with the all shares moved and only that one account showing:



Above was done with a date of today for the transfer of shares.

Done again with a date of 1/1/2021.

Gary R

Thanks for all the replies--I have to digest them fora while, but I have much bigger problems that came up yesterday. I decided to compare my Investment performance report in Quicken to Fidelity Statements and the amounts are completely crazy. I spent hours and realized that Apple is the problem. I've owned Apple for over 10 years. On 8/28/20 Quicken shows Apple price at $499 and the next day it's $129
I know the stock split, but it looks like All the prices are completely screwed up in my Performance reports. I have no idea how to fix this

Jim_Harman

[edited after further experimenting]

I experimented with two accounts with shares transferred in mid-year, making sure the portfolio view included securities that were hidden. In the Options menu I selected the Show closed lots option. I set the As of date to 12/31 of that year.

Both accounts and their holdings are shown in the view. The Avg Annual Return (%) 1 year results are shown for all the securities, but may look odd because the securities were not held in the account for the full year (see below)

If you look at the Investment Performance Report for the same period with the two accounts selected and no subtotaling, you should see Removed and Added transactions on the transfer date. The amounts removed and added are the same, so the cash flows cancel out and do not affect the IRR calculation. Thus the report's AAR will be the combined return for the two accounts. The ARR also matches the ARR at the bottom of the Portfolio view. 

Note that the Average Annual Return is an annualized figure. The YTD return or any returns where you did not hold the security for a full year assume that the partial year results will continue at the same rate for the rest of the year, which may not be realistic.

Tom Young

"I spent hours and realized that Apple is the problem. I've owned Apple for over 10 years. On 8/28/20 Quicken shows Apple price at $499 and the next day it's $129

I know the stock split, but it looks like All the prices are completely screwed up in my Performance reports. I have no idea how to fix this."

Those are the correct pre and post-split prices reflecting an 8/31 split where you received 3 new shares for each 1 share you owned, so it doesn't look like your prices are all screwed up, at least not those prices.  Did you record the split itself so that your holdings are properly stated?

Gary R

Tom--I've been at this since 3 am this morning and took 20 minutes for lunch. I've now become obsessed with this and getting deeper in the hole. I have eight accounts that are affected, and realized after many hours that Fidelity never downloaded the splits. To make matters worse, I held Apple in several accounts in 2014 and found out they did a 7 for one split. By the time I finished this mess, my portfolio was worth millions more----well just on paper-----I got so screwed up that I was physically sick to my stomach. I'm going over Vanguard next, comparing the year end statements with Yearly Quicken performance reports---That should be fun------

Chris_QPW

Just so you know from what I have seen, Quicken only needs the split to be entered in any account, and it will then use it for all accounts.  It doesn't have to be entered in every account.  That also implies that if different accounts have the split information on different dates that would cause problems.

Gary R

Good to know---thanks Chris