MMEX Discussion Forum

MMEX newbie here, I am trying to set up an Investment account.

I am taking a look at the documentation section, but I am still a bit confused. This is the first time I use accounting software and I`m not familiar with the workflow and with some concepts.

Here is what I'm trying to model in MMEX: my bank offers investment options, and I applied for an investment fund. Every month, my bank automatically withdraws a certain amount of my bank account (for example $50) and buys this amount in the fund shares for me. The investment funds are also from my bank. I will call my bank "MyBank".

Here is what I tried to do in MMEX:

• I opened a Stock account called MyBank_Broker (as my bank acts as the broker). I left the initial balance as $0.00.
• I created an initial stock investment, in a company MyBank_Company (as the investment is in funds of my bank). In this investment I set the amount of shares I have today, and also their price, for example $1000 for 500 shares with $2 a share.
• I now have, inside MyBank_Broker, a Stock account called MyBank_Company, where I can see the operation of purchasing of $1,000.00 of shares to MyBank_Company. I also set the initial balance for this account as $1,000.00.
• The last step created a Share Account, MyBank_Company, where I can see exactly the same information as my MyBank_Company Stock Account.

Now, here is what I don't understand: In my MyBank_Company Stock Account/MyBank_Company Share Account I have "Account Bal: $0.00 Reconciled Bal: $1,000.00 Diff: $-1,000.00. Should the Diff not be 0.00? It seems that I am negative, but that is not the case. I set the initial value of the accounts to $1.000,00 because I thought it would be counted as the money I used to buy the initial lot of shares of my account, but that reasoning seems wrong.

I am attaching some screenshots of the steps I performed.

If I understand correctly, also, the Share Account for "Company X" exactly mirrors the Stock Account for "Company X"? If so, what is the purpose of having these two?

Thanks for all the help.

Regards

Hmmm interesting

set the initial value of the accounts to $1.000,00 because I thought it would be counted as the money I used to buy the initial lot of shares of my account, but that reasoning seems wrong.

I also think so...

• Did you transfer from a normal account the money to get the shares to the Share Account?

• Have you tried to use newer version of MMEX (portable version) and see if there is updates?

Hope this helps...

Hey, thanks for the comment.

I haven't tried to use the portable version as of yet.

In the end, I used the following setup. It is basically what I've commented on previously, but now I grasped the workflow better. It is a bit clunky, but it works for my case.

1. I created a Share Acount that represents my bank's broker. I'll call this MyBank_Broker. It opened it with the amount I had in shares. For example, if I had $100 in 10 shares, I opened this account with $100. Each share has a value of $10 in this case.
2. I go to the Stock Portfolio of MyBank_Broker. I add a New Stock Investment and I buy the initial value worth of shares (in this case 10 shares for a worth of $100). Now MyBank_Broker has a balance of zero.
3. To update my amount of shares, in the beginning of each month I transfer $100 my from normal bank account to the Share Account of MyBank_Broker.
4. From my bank, I get the share purchase price and use it to calculate the number of shares to purchase knowing that I will invest $100. For example, my bank says that now the shares are worth $10.5. I will buy $100/$10.5 = 9.524 shares.
5. I go to the Stock Portfolio of MyBank_Broker and I Add a Stock Transaction to the one I set up before (careful: I add a Stock Transaction, I do not create a new Stock Investment, since I am purchasing the same shares). 9.524 is the Share Number, and $10.5 is the Share Price.

This works for me, so for the moment I think I will keep up doing it. Hope it is useful for other also.

Regards

plus @Nickallington

Hi @ParadigmShifter , @MlinMMEX and @Nickallington

This workflow might work well, and you can comment further in Stock on MMEX

In short.
1. Investment account is the key account type to reflect the balance. buy and sell would trigger its transfer to/from. it is to trigger new stock holding as well (the only action).
2. Share account is just a bridge between, in theory, this is the trigger of most actions (expect new). buy and sell will trigger deposit and withdrawal to ensure its zero balance.
3. Stock would reflect the final shares and price
4. all these actions would be logged in transactions and all data would be matched.

thoughts?

Hey! Thank you for your detailed explanation... I missed two things:

a) the commissions on the transactions and taxes held, which are part of the categories of expenses.
b) a simple .mmb file to have all included as example to practice!!

Good catch.
1. commission & tax would be counted in the withdrawal and deposit, both share and investment accounts can only see a single number.

here you go a sample database with a very similar setup.
note:
1. Today MEMX4Desktop only supports buying and increasing holding and decreasing holding are TBD.
2. The link between stock and share account is a little bit trick, we can simplify it with a name match in the future.


NOTE: this attachment is NOT complete yet.

V2 to have shareinfo_v1 (number, price, and commission) included, note this is transparent to the Investment and Shares accounts.

hi @ParadigmShifter

If we focus on the portfolio's balance, it might be good. here is xxx_Broker.
xxx_Company is to record the detailed purchase/increase/decrease operation to the hard-linked stock(s).

So, the scenario would be to have many stock brokers (eToro and YahooFinance for example), with both a set of stock portfolio.
Those portfolio would receive cash from accounts to buy, (transfers) and would give cash from dividends or stock sales.

What I would like to track is:
(a) if there was a gain or loss in a specific period (fiscal year) for all stock brokers (invetment accounts)
(b) how much were commissions and taxes held in those operations. Seems that there are not clear categories to assign those concepts.

In terms of setup, there is a lot of flexibility so far. One possible way is

1. - NYSE: set up a Portfolio (Investment Account) per exchange. e.g. NYSE with USD assigned.
2. |--- AAPL, with company name (broker) as eToro
3. |--- TSLA, with company name (broker) as eToro
4. |--- TSLA, (the 2nd LOT), with company name(broker) as YahooFinance.

in above, will have
1. one portfolio(investment account): NYSE, to track the balance
2. three stocks or stock lots, #2, #3, #4, to track the positions.
3, two brokers (shares account), eToro and YahooFinance, to track the details. (the balance might be negative, as the dot lines are virtual and on the fly).

As all things are tracked,
a) is possible though not implemented yet.
b) you can choose whatever you want and keep it consistent.