How to handle stock options owned when stock splits?
Options
Steven Herman
Member ✭✭
I own some options and am short other options on DDD which recently split 3 to 2. The old options within my brokerage accounts have been changed to options with 150 shares and a strike price of 2/3 of the prior strike price and the option symbol has changed to reflect this. To continue tracking option prices on these options in Quicken 2013 Deluxe, it appears that I have to remove the old options (remove on owned and add on short) and add the new options. Is that correct? Should I do so with zero price and value or should I put the price as what I originally had from the original transaction on the options? The former tries to treat it as a "name change" but generates gain or loss where not warranted and zero cost basis of post split options. The latter generates no gain or loss but has incorrect dates for acquisition/sale. Technically it is not a trade but apparently it seems Quicken has no way to reflect this in the same way it handles stock splits on the stock.
Are there any better ways to handle this?
Are there any better ways to handle this?
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Comments
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I have Quicken Deluxe 14, and had the same problem. I wound up making two sets of entries: stock splits and then re-names. I did not use the "remove shares" or "add shares" functions at all.
First, I entered a Stock Split transaction for the day of the split (mine was a 2:1 split, so I entered "2" in the "new shares" field, a "1" in the "old shares" field, and just left the price field blank). I did that for each open option position I had for the underlying stock that had split. I had sold options short, and these "StkSplt" entries correctly doubled the number of option shares I was short, and correctly preserved my original option sale proceeds (negative cost basis amounts).
Then, I renamed the affected options, using the Tools > Security List > Edit Security Details feature. I just added "Split 2:1 2/12/17" to the end of the original option names. These amended names then flowed to my original option sale transactions, as well as the StkSplit entries I made as noted above. I'll use these names in the future when I close my positions, so there is continuity at each transaction date.
Hardly perfect, but this way I think Quicken will correctly track my gains / losses & holding periods.
Hope this helps, and if there's a better way, please post.0 -
Personally, I would just do a remove shares (all existing) and then an add shares (cover and short for the short sale) to re-establish at the correct shares and price using the original basis and dates0
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