Canada RRSP Mutual Fund "exchanged" to different class

Markhfx
Markhfx Member ✭✭
On March 31 my RRSP Fund holder TD, "exchanged" a number of my funds to a similar one with a different fee structure.... What is the best way to account for this in Quicken as I did not "sell" the fund and buy new.... and if I do it that way my cost base would be altered. Is it best to use "Mutual Fund Conversion" will it retain my history and original cost? Other suggestions? Note the new funds have a different price and symbol
Thanks

Answers

  • Tom Young
    Tom Young SuperUser ✭✭✭✭✭
    "Is it best to use "Mutual Fund Conversion" will it retain my history and original cost?"
    That is EXACTLY the correct Quicken "wizard" to use in a situation where a mutual fund is exchanged - tax free - for a different mutual fund. 
    However, if you've been using "average cost" as your basis tracking method then, at some point, Quicken introduced a bug whereby the cost bases for the new mutual funds will be incorrect.  As far as I know this bug has not been fixed.  So if you've used average cost for some of the funds switch those funds to using any other method of determining cost basis before using that wizard.  And, of course, make a backup first.
  • Michel S
    Michel S Member
    I have a similar situation, but my mutual fund holder IG (investor Group) did exchange one set of mutual funds for two different mutual fund. Can it done thru "Mutual fund conversion" ?
  • Tom Young
    Tom Young SuperUser ✭✭✭✭✭
    "exchange one set of mutual funds for two different mutual fund. Can it done thru "Mutual fund conversion" ?"
    NO, not directly.  With the first use of the Mutual Fund Conversion the old fund is "gone" so it isn't available for another conversion.  I think there's a couple of ways of approaching this.
    The first way would be a Remove action on the old mutual fund followed by Adds of the two new mutual funds.  You'd have to do your calculations outside of Quicken and then enter (maybe) lots and lots of Adds, but it should work.
    The second approach could be to use the "Corporate Securities Spin-off" for the first leg of the conversion, then use the Mutual Fund Conversion action for the remainder of the conversion.  Again, you'd have to do some calculations outside of Quicken to ensure the total basis of the old fund was properly split up and then enter things correctly in the two actions.  The problem with the Corporate Securities Spin-off action is that this works across your entire data file, so if the old fund exists in different Accounts those shares would also be affected.
    It goes without saying, but I'll say it anyway, make a backup of the file before attempting this.

  • Markhfx
    Markhfx Member ✭✭
    > @Tom Young said:
    > "Is it best to use "Mutual Fund Conversion" will it retain my history and original cost?"That is EXACTLY the correct Quicken "wizard" to use in a situation where a mutual fund is exchanged - tax free - for a different mutual fund. 
    > However, if you've been using "average cost" as your basis tracking method then, at some point, Quicken introduced a bug whereby the cost bases for the new mutual funds will be incorrect.  As far as I know this bug has not been fixed.  So if you've used average cost for some of the funds switch those funds to using any other method of determining cost basis before using that wizard.  And, of course, make a backup first.

    Upon doing this, quicken added many entries rather than just one converting the funds, this added to the cost basis by a factor of 6??? Tried it with a diff security same result.... Not sure why but this is not working...
  • Tom Young
    Tom Young SuperUser ✭✭✭✭✭
    "Upon doing this, quicken added many entries rather than just one converting the funds..."
    Mechanically the way this action should work is that it generates a Remove action for the old fund and then many Add actions for the new fund, one for each lot of the old fund, so the "many entries" isn't unusual.
    "... this added to the cost basis by a factor of 6???"

    From the sounds of it you were using "average cost" for the old fund, but didn't convert from average cost to a different costing method before doing the conversion.  If there are N tax lots of the fund being converted, the cost basis ends up being N times what it should be.
    So, you might restore your backup and try again.  If for whatever reason you continue to have problems, you might want to try the Corporate Acquisition method, (assuming the old fund doesn't exist in other Accounts), or try the manual entry of one Remove and then manual Adds of the new fund.

  • Markhfx
    Markhfx Member ✭✭
    How do you change from using "average cost" I don't know where to look or change that setting...
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