Stock Split Problem

TomMaly

Quicken can't accurately reflect a stock split. I welcome a solution; surely, many people have this problem.

After a 2 for 1 stock split, the price of the stock is half its previous value. No problem there. It's simple to reflect a "Stock Split" in my Quicken brokerage account, so I now have twice the number of shares. All good so far.

The problem is Quicken doesn't accurately reflect historic prices of the stock. Quicken has cut all historic prices by half. On an "adjusted" basis, that's correct; to show an apples-to-apples comparison of prices, you'd want to cut historic prices in half. But the historic number of shares I own has not doubled; that, too, is accurate--I didn't own twice the shares until the day the stock split was recorded. The result is my historic value of the stock position is half its accurate value.

For all accounting to be accurate, Quicken must either NOT cut all historic prices in half (I believe that is an accurate solution) or show my historic number of shares as double what I had.

Jim_Harman

Did it really cut ALL the historic prices in half when you look at the security's price history, or just the past few days? Sometimes Quicken's pricing data is out of sync with the split dates.

Ps56k2

What are you looking at ....

In the Stock Detail screen -
A - the "graph" shows the Price History - with or without the Split Adjusted checkmarked
B - the "graph" shows the Market Value - totally adjusted for any and all historical transactions.

q_lurker

TomMaly said:

Quicken can't accurately reflect a stock split. I welcome a solution; surely, many people have this problem.

...

For all accounting to be accurate, Quicken must either NOT cut all historic prices in half (I believe that is an accurate solution) or show my historic number of shares as double what I had.

To say Quicken can't ... is simply balderdash.  The program absolutely CAN handle stock splits correctly.  But it is also wholly accurate to say the program can royally screw stock splits up in a variety of ways.  

To be fully accurate historically, the prior-to-split prices should NOT be adjusted for the split.  The price adjustment should appear coincident with the date of the split. 

To the problem you cite with historical prices being halved, what I have seen is that the quote supplier may adjust historical prices for the split.  If the user has a full history of prices, those values should not be changed.  If the user's historical prices are incomplete, those adjusted prices from the quote supplier may get inserted incorrectly into the users historical records.  It can become a further problem to fix if data sources like Yahoo-finance also present only the split adjusted historical prices. 

So I do feel your pain.  I have had instances where I needed to go all out to delete bad (historical split adjusted) prices and somehow rebuild the price-history with non-adjusted prices.   

Ps56k2

For my recent ISRG split on 10/5 - I did the usual....

A - delete the downloaded ADD Shares transaction
B - create a Stock Split transaction reflecting the correct ratio of 3:1

and then.... because somewhere, somehow, the Quicken Price History starts reflecting the stock split a WEEK prior to the split

C - edit the Price History to better reflect the pricing and market value ... the entries from 9/29 -> 10/4 are wrong

Subject to stockholder approval of the Amendment to the Certificate of Incorporation, each Intuitive stockholder of record at the close of business on the record date of September 27, 2021, will receive two additional shares for every one share held on the record date, and trading is expected to begin on a split-adjusted basis on October 5, 2021.

NotACPA

It's been my experience that the price adjustment occurs on the Ex-Div day of the split ... rather than on the day of the split itself.

I'd call this action at least defensible.

Ps56k2

Interesting.... I added that declared info to my Price History posting above....

mgreene

The Ex-Date for a stock split (or a stock dividend) is the 1st Business day after the split. Splits, like stock dividends occur in the twilight after the the business day closes. That day's closing price is unaltered. The opening price on the next business day is the split adjusted price. Price vendors will sometimes split-adjust history because it makes performance and price comparison easy. Historic prices in a "portfolio management system" such as Quicken should NEVER be changed to use split-adjusted prices because it completely destroys the accounting.

q_lurker

mgreene said:

… Historic prices in a "portfolio management system" such as Quicken should NEVER be changed to use split-adjusted prices because it completely destroys the accounting.

I couldn’t agree more. Yet that is exactly what the data suppliers Quicken contracts with provide. If the user has kept up with downloading prices (daily), everything seems to work well.  Downloading prices weekly, monthly, or erratically is where problems develop. 

Jim_Harman

The key to accurate accounting for splits is to record the change in the number of shares (controlled by the Split transaction) and the price change on the same day.

Sometimes the change in downloaded prices is off by a few days, leading to a big jump in the market value for that period.