zyzzyva57
03-28-2008, 09:35 PM
I had some questions about trading, so I thought you might find these answers from Scottrade helpful, too:
In regards to your question of "How does GainesKeeper show this my portfolio value?", the GainsKeeper application uses the "Total Cost" of the entire transaction including any commissions and fees to calculate your cost basis, not just the cost per share you paid to acquire the stock.
Therefore, if your total cost on one transaction was $10 and the total cost on another transaction was $20 and the total amount of shares purchased was 2 shares, Gainskeeper would figure your total cost as such:
(1 share) * ($10.00) = $10.00
(1 share) * ($20.00) = $20.00
$10.00 + $20.00 = $30.00
($30.00) / (2 shares) = $15.00 total cost per share
Please note that the commission and fees associated with a trade can be viewed by looking at the confirmation for that particular trade.
To view confirmations in your account, click the 'Account History' link in the left margin under the 'My Account' tab. Then click the 'Confirmations' tab that should appear in the middle of the page.
You can use the Date, Trade Type, and Symbol filters to find a specific trade. Click the blue date link for the confirmation you would like to view.
To print the confirmation, click the 'Printer Friendly' link at the top right corner of the confirmation page and then click to print that page.
In regards to your question of "The stock goes to $40, so if I sell one share, which stock value is sold? The $10 or $20 or $30 stock?", Scottrade rectifies your account in a first-in, first-out basis. First-In, First-Out (or FIFO) accounting is a method of valuing the cost of securities sold that uses the cost of the oldest shares in inventory first. Please note that GAINSKEEPER IS AN ACCOUNTING TOOL AND HAS NOTHING TO DO WITH THE ACTUAL PER SHARE COST PAID (OR RECEIVED) IN REGARDS TO PLACING A TRADE. Therefore, if you purchased the security at the $10.00 amount first and then sold the share at $40.00, you would have a $30.00 gain in this instance.
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In regards to your question of "Can I control the stock value to sell?", you may control the value of the stock sold in several ways. One way to control the value of the stock sold would be to add a limit, stop, stop limit or trailing stop qualifier to your sell order. By adding a limit, stop, stop limit or trailing stop qualifier to your order, you are controlling (albeit to a limited extent) the price that you will receive on a sales transaction. I have delineated these order types below:
Limit Order:
An order to a broker to buy a specified quantity of a security at or below a specified price, or to sell it at or above a specified price (called the limit price). This ensures that a person will never pay more for the stock, or sell the stock for less, than the limit price. If the price is not reached, the order will not execute.
Stop Order:
A market order to buy or sell a certain quantity of a certain security if a specified price (the stop price) is reached or passed. Once your price is reached or passed your order will be sent to the market maker to be filled at the current trading price. This price can be different than your designated stop price. A stop order is placed below the current market price if you are selling, and above the current price if you are buying. The stop order is also referred to as a stop loss order, if used when selling.
Stop Limit Order:
An order to buy or sell a certain quantity of a certain security at a specified price or better (the limit price), but only after a specified price has been reached, (the stop price). A stop limit order is essentially a combination of a stop order and a limit order.
Trailing Stop Order:
A trailing stop order is a complex stop order in which the stop price is set at a fixed percent or number of points below the market price. As the market price of the stock in question fluctuates, so will the stop price as it "trails" the market price based on the fixed percent or number of points indicated when the trade was entered. The order will execute if the stop price is ultimately reached or passed. Trailing stops may be used for both sells and purchases.
As, I had previously stated, by default all sell orders in a Scottrade account are settled on a first-in, first-out (FIFO) basis. You do have the option of "controlling" the stock value to sell by opting to sell your shares last-in, first out (LIFO). This would be the situation where you would sell the shares acquired at $20.00 (your second transaction).
A sell order in which the shares sold are specified by purchase date is called a "versus purchase" trade.
If you wish to make this optional notation on your confirmation summary, you will need to call your local Scottrade branch office for broker assistance (the commission would still be the normal $7.00 rate). A versus purchase notation cannot be placed on a trade entered online or a trade that has already executed.
Finally, please note that the Realized Gain or Loss Reports provided by the GainsKeeper application is not a complete report intended for tax purposes. Compare it with the official records of your account to verify its accuracy.
Neither Scottrade nor any of its representatives may give legal, tax or investment advice. Scottrade does not review the information that you provided in the baselining process or any other information updating process. You are solely responsible for the accuracy of your cost basis and change information reported to federal, state, and other taxing authorities.
Scottrade makes no warranties with respect to and specifically disclaims any liability arising out of your use of, or any tax position taken in reliance upon, the information provided by the GainsKeeper application. The GainsKeeper application uses the first-in, first-out (FIFO) method for realized gain or loss for equity securities and options. The average cost-single category method is used for open-end mutual funds.
In regards to your question of "How does GainesKeeper show this my portfolio value?", the GainsKeeper application uses the "Total Cost" of the entire transaction including any commissions and fees to calculate your cost basis, not just the cost per share you paid to acquire the stock.
Therefore, if your total cost on one transaction was $10 and the total cost on another transaction was $20 and the total amount of shares purchased was 2 shares, Gainskeeper would figure your total cost as such:
(1 share) * ($10.00) = $10.00
(1 share) * ($20.00) = $20.00
$10.00 + $20.00 = $30.00
($30.00) / (2 shares) = $15.00 total cost per share
Please note that the commission and fees associated with a trade can be viewed by looking at the confirmation for that particular trade.
To view confirmations in your account, click the 'Account History' link in the left margin under the 'My Account' tab. Then click the 'Confirmations' tab that should appear in the middle of the page.
You can use the Date, Trade Type, and Symbol filters to find a specific trade. Click the blue date link for the confirmation you would like to view.
To print the confirmation, click the 'Printer Friendly' link at the top right corner of the confirmation page and then click to print that page.
In regards to your question of "The stock goes to $40, so if I sell one share, which stock value is sold? The $10 or $20 or $30 stock?", Scottrade rectifies your account in a first-in, first-out basis. First-In, First-Out (or FIFO) accounting is a method of valuing the cost of securities sold that uses the cost of the oldest shares in inventory first. Please note that GAINSKEEPER IS AN ACCOUNTING TOOL AND HAS NOTHING TO DO WITH THE ACTUAL PER SHARE COST PAID (OR RECEIVED) IN REGARDS TO PLACING A TRADE. Therefore, if you purchased the security at the $10.00 amount first and then sold the share at $40.00, you would have a $30.00 gain in this instance.
===========
In regards to your question of "Can I control the stock value to sell?", you may control the value of the stock sold in several ways. One way to control the value of the stock sold would be to add a limit, stop, stop limit or trailing stop qualifier to your sell order. By adding a limit, stop, stop limit or trailing stop qualifier to your order, you are controlling (albeit to a limited extent) the price that you will receive on a sales transaction. I have delineated these order types below:
Limit Order:
An order to a broker to buy a specified quantity of a security at or below a specified price, or to sell it at or above a specified price (called the limit price). This ensures that a person will never pay more for the stock, or sell the stock for less, than the limit price. If the price is not reached, the order will not execute.
Stop Order:
A market order to buy or sell a certain quantity of a certain security if a specified price (the stop price) is reached or passed. Once your price is reached or passed your order will be sent to the market maker to be filled at the current trading price. This price can be different than your designated stop price. A stop order is placed below the current market price if you are selling, and above the current price if you are buying. The stop order is also referred to as a stop loss order, if used when selling.
Stop Limit Order:
An order to buy or sell a certain quantity of a certain security at a specified price or better (the limit price), but only after a specified price has been reached, (the stop price). A stop limit order is essentially a combination of a stop order and a limit order.
Trailing Stop Order:
A trailing stop order is a complex stop order in which the stop price is set at a fixed percent or number of points below the market price. As the market price of the stock in question fluctuates, so will the stop price as it "trails" the market price based on the fixed percent or number of points indicated when the trade was entered. The order will execute if the stop price is ultimately reached or passed. Trailing stops may be used for both sells and purchases.
As, I had previously stated, by default all sell orders in a Scottrade account are settled on a first-in, first-out (FIFO) basis. You do have the option of "controlling" the stock value to sell by opting to sell your shares last-in, first out (LIFO). This would be the situation where you would sell the shares acquired at $20.00 (your second transaction).
A sell order in which the shares sold are specified by purchase date is called a "versus purchase" trade.
If you wish to make this optional notation on your confirmation summary, you will need to call your local Scottrade branch office for broker assistance (the commission would still be the normal $7.00 rate). A versus purchase notation cannot be placed on a trade entered online or a trade that has already executed.
Finally, please note that the Realized Gain or Loss Reports provided by the GainsKeeper application is not a complete report intended for tax purposes. Compare it with the official records of your account to verify its accuracy.
Neither Scottrade nor any of its representatives may give legal, tax or investment advice. Scottrade does not review the information that you provided in the baselining process or any other information updating process. You are solely responsible for the accuracy of your cost basis and change information reported to federal, state, and other taxing authorities.
Scottrade makes no warranties with respect to and specifically disclaims any liability arising out of your use of, or any tax position taken in reliance upon, the information provided by the GainsKeeper application. The GainsKeeper application uses the first-in, first-out (FIFO) method for realized gain or loss for equity securities and options. The average cost-single category method is used for open-end mutual funds.