How to handle expiring options

Duane K.
Duane K. Quicken Windows Subscription Member ✭✭
edited September 2023 in Investing (Windows)

I trade maybe 10-20 options monthly and often they expire worthless. Every couple of months, I notice that the one account where I trade is off in quicken and when I look, I see options which expired that are still showing a position (positive or negative when they should have zeroed out at expiration) and are the cause of the inconsistency. I have been going pains takingly through and closing out these transactions by hand. To do so, I pull up my account (I use Schwab) and go through transactions by transaction and put individual entries into Quicken (I am on Quicken Deluxe Version R51.12 Build 27.1.51.12). In each and every case there is a transaction in my account which says "option expired" - and this is what I am loading into quicken manually. But this is the reason I bought Quicken, for the automatic upload.

So, my question is, should I be doing something differently with how I use Quicken or is there some other tool people would recommend which handles these better? Thanks in advance!

Comments

  • Tom Young
    Tom Young Quicken Windows Subscription SuperUser ✭✭✭✭✭

    Unfortunately it's really impossible to run an Investment Account and keep it accurate relying solely on downloads, except in the very simplest situations, and only if all transactions actually do get downloaded. It's not infrequently reported in here Schwab Accounts sometimes omit to download one or more transactions, and that sounds like that's the situation here.

    If you're allowing downloaded transactions to be automatically entered into the Transaction List then it's easy to overlook the fact that a transaction that should be downloaded hasn't been downloaded.

    I'd suggest turning "Automatic entry" to OFF. That means that all transactions first show up in the "Downloaded Transaction" window below the Transaction List, waiting to be accepted. At least that way you're more likely to notice in near real time that a transaction hasn't been downloaded can enter it manually, obviating the need to manually address each and every transaction. If the transaction shows up some time later it will find a "Match."

  • Maven100
    Maven100 Quicken Mac Other Member

    I am experiencing a similar issue with expired options showing up in the portfolio view. I checked to make sure all "Buy to Cover" transactions are matched to "Sell Short" transaction. Yes, they were downloaded in a correct format from my broker. Here is the strange thing. Its seems to be inconsistent. Only some options positions remain in the portfolio view after the expirations. Others are are handled correctly and disappear from the view. I also tried to add the same transaction manually and it didn't change the view. So its not really an issue of 'missing downloaded transactions".

    I called Quicken tech support, no use, I don't think the guy really knew the answer. So some of the expired option positions are still showing, although they do not show with average cost per share (the only difference between expired and active positions.

    If anyone knows how to fix it or has a workaround, please let me know, as I don't want this view to become worthless with many expired options positions.

    I am Quicken Deluxe for Mac, version 7.2.1 using MACOS Ventura.

  • QWinUser
    QWinUser Member ✭✭✭✭
    edited August 2023

    @Diane K - To close out an Expired Option go to the Expire transaction in your register and manually update the remaining number of shares directly into the "Shares" field, by clicking on that field. Using the "Edit" button will not work. Since you already updated the transactions, I am not sure this will work any longer. I found that Options transactions are very touchy. If you change a component transaction, it does throw things out of wack. After that happens, there is no way to correct the situation except restore a backup or recreate the options transactions again and then close the option.

    @Maven100 - I noticed that you are using Quicken Mac. I am not sure that this method will work for you. (This thread is for Q Win)

  • Maven100
    Maven100 Quicken Mac Other Member

    So I just found a solution posted by another user awhile back.

    Essentially, for some reason at some point Quicken automatically creates an 'ADD SHARES" transaction and adds the same number of shares dated on 12/31/1999. This transaction creates additional shares that keeps the position in a portfolio view. I have no idea why they add shares to a position that has already been reconciled/closed out with the offsetting transaction, but here is the solution below that helped me. As someone pointed out, I am a MAC QUICKEN user, so it may or may not be the same for Win users

    "Go into the transaction view and find the "buy to sell" entry associated with the call or put that's expired but still showing up in your portfolio view. Once located right click and select the "Find" Put or Call associated with the transaction. When you select this you'll likely see the original put or call, the buy to sell and then a third entry eroneously created. I found when I deleted this third entry, it reconciled the short position and it no longer showed in the portfolio view. 

  • Duane K.
    Duane K. Quicken Windows Subscription Member ✭✭

    Spent 2-3 hours cleaning this up Sunday and also noticed that when you sell options it coverts them to the 100 shares per contract, so if you sell 20 contracts the entry it creates shows -2,000 shares of the option. This makes sense. However, in most cases, but not always, it does have the expiring transaction, but will only show 20 shares traded, leaving you with 1980 shares and a balance that isn't valid. I probably changed a couple dozen of these entries and resigned myself to have to do this once a month or if Quicken gets too out of sync with my one trading account. Not sure if there is anything one can do to avoid this issue by using Quicken differently - seems like a bug in the Quicken machine to me.

  • Maven100
    Maven100 Quicken Mac Other Member

    Hmm, all my option contract transactions do convert to shares properly. If properly downloaded from your broker, its should be the same number of shares on opening and closing positions.

    The other issue thats somewhat annoying, is that they calculate net gain incorrectly on a short option positions . For ex, if I am short a call at 2.50 and its now 1.50, (which is a gain of 40%), its shows up a loss of 40% instead!

  • Maven100
    Maven100 Quicken Mac Other Member

    I am experiencing a similar issue with expired options showing up in the portfolio view. I checked to make sure all "Buy to Cover" transactions are matched to "Sell Short" transaction. Yes, they were downloaded in a correct format from my broker. Here is the strange thing. Its seems to be inconsistent. Only some options positions remain in the portfolio view after the expirations. Others are are handled correctly and disappear from the view. I also tried to add the same transaction manually and it didn't change the view. So its not really an issue of 'missing downloaded transactions".

    I called Quicken tech support, no use, I don't think the guy really knew the answer. So some of the expired option positions are still showing, although they do not show with average cost per share (the only difference between expired and active positions.

    If anyone knows how to fix it or has a workaround, please let me know, as I don't want this view to become worthless with many expired options positions.

    I am Quicken Deluxe for Mac, version 7.2.1 using MACOS Ventura.

This discussion has been closed.