Re: Purchase/redeem Funds

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Posted by Mark on January 11, 2007 at 20:30:09:

In Reply to: Purchase/redeem Funds posted by H. C. Pierce on January 11, 2007 at 20:11:01:

: Mark: I do not understand what is happening with funds where distributions are re-invested. When the distribution is credited to my fund and converted to additional shares, the value and number of shares go up; however, the cost (the total investment in the fund) which should have risen due to the new investment of the dividend value does not show any increase. This does not seem proper.

: Conversely, If I sell shares the number of shares decreases and the cost of the fund is decreased. This seems proper.

: Further, there is no provision to designate the transfer location of the proceeds of a sale not the source of a cash transfer to fund a purchase.

: Best regards, Chuck Pierce

Hi Chuck,

Which cost figure are you looking at? It sounds like you are looking at an "OOP" cost. This is the cost type that is graphed. The OOP cost does not increase when you have a reinvested distribution. No money came out of your pocket, so the out of pocket cost remains the same. If you were looking at your tax cost basis, this would go up in the case of a reinvested distribution.

I didn't follow the question about designating a transfer location? If you have a default cash account assigned, the proceeds automatically go into or come out of the cash account when you record a transaction in any investment in that sub-portfolio. If you want the proceeds to go/come from somewhere else, you could manually make that entry, but there is no automated support for this.

Thanks,
Mark
--
Fund Manager - Portfolio Management Software

Replies:

• Re: Purchase/redeem Funds H. C, Pierce 23:52:51 01/11/07 (1)
  • Re: Purchase/redeem Funds Mark 00:22:23 01/12/07 (0)