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ALEX
Portfolio tracking and tax season.
posted Mar 18 '17 by alex
Portfolio tracking and tax season.

There are many people at stock2own community who suggested to have a portfolio tracking functionality. And it seems like a straightforward approach and a logical step forward. However we hesitate to even start working on it because of the complexity of this task.

You may argue that keeping track of buy and sell transactions is not difficult and many of us keep doing it in spreadsheets. This is true. But we feel that if we decide to provide portfolio tracking as a stock2own solution, we would want it to be a complete solution.

For instance, if I own a stock that pays dividends I want to see dividend amounts in my portfolio. Because I want my cash balance to reflect my actual cash balance in my brokerage account. Would you agree?

And what about all other types of corporate action events? I would like all the stock splits, name changes, mergers and spinoffs be shown there as well.

To make things even more complex, corporate actions are not the only events that can change my cost basis (and therefore determine if I get gain or loss when I close my position). There are a bunch of IRS rules that may require you to adjust cost basis of an open position. For instance, in the USA, if you sold a stock for a loss and bought it again within 30 days window, IRS is not allowing you to fully recognize that loss, instead, it wants you to adjust cost basis of your new position. It called “wash sale” rule.

Keeping all this in mind, stock2own wants to keep focusing on stock analysis and we are working tirelessly to improve data quality and our algorithms.

Meanwhile, tax season is upon us and if you have an account with any major online brokerage, there is a big chance that your brokerage will give you all necessary tools to track your positions and file your taxes with no extra charge.

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