Stocks and Shares

Stocks, Shares and Share Dividend Management

The terms Stocks and Shares generally mean the same thing but depending on how we use these terms, could mean something different. Here we refer to Stocks as companies, and Shares as units of value within the company. Generally we would obtain Stocks via a Stock Broker and purchase or sell shares in the company.

Initializing Stocks and Shares is initially a two stage process.

1. First we create the Stock Entry and the associated Share Account.
2. We add the initial Shares information to our Share Account.

Any subsequent transactions involving Share movements is accessed via the company in the Stock Portfolio view.

Any transaction associated with our normal accounts is done via the Account View using the associated Shares Account.

Creating a Stock Portfolio for our Stocks

In order to use Stocks and Shares in MMEX, we need to create an account of type: Investment.

The name for this account would generally be the name of the Stock Broker. In our example we have selected the stock broker being called Yahoo Finance.

This account would appear in the Navigator under the heading Stock Portfolios. When we expand the Stock Portfolios branch in the Navigator, we would see our newly created Stock Portfolio account.

Selecting our new account Yahoo Finance opens the view: Stock Portfolio: Yahoo Finance. In this view we can now add the stocks that we own.

Adding Stocks to our Stock Portfolio

We refer to Stocks as the companies that we have purchased shares.

Let us say that we purchase shares in two companies from out stock broker Yahoo Finance, we would create new entries in the stock portfolio view for our companies.

As an initial entry for each company we would supply the following:

Company Name

This will also allow us to create a Share Account for this company of the same name.

Example: Alpha Corporation

Stock Symbol

APC being the Stock Exchange code, AX being the Stock Exchange to obtain current share value information

Example: APC.AX

Share Number

The initial number of shares

Share Price

This is the cost per share

Commission

This is generally the remaining value for incomplete shares

Example: Purchase of $1,000.00 worth of shares at $2.35 per share, gives us 425 shares and $1.25 as commission.

Saving this entry, the Share Account and Share Linkage can be set up.

Subsequent use of this dialog allows us to update the share price for this stock. When aditional shares have been purchased, this price will affect all shares.

Adding Initial Shares to our Stock

Now that we have created the initial Stock entry, we need to Add a Transaction to our Stock to create the initial Shares entry. The initial share information is transferred to our new share transaction.

Here we would add extra information similar to a normal transaction.

Account

This would be the associated Share Account created when the Stock was initially created. If this was not done, any other account can be used for this transaction.

In order to keep track of transactions, it is recommended that a Share Account is created.

Type

Withdrawal from the share account represents a deposit to the actual shares.

Deposit from the share account represents a withdrawal to the actual shares.

Transfer

All Share transactions are in effect transfers to and from actual share investments depending on the transaction being a purchase or sale of shares.

If the transaction is required to be accounted as an expense or as income, we would then remove the transfer selection.

Adding Subsequent Share Entries to our Stock

Purchase or sale of shares is achieved by accessing the stock entry in the Stock Portfolio view and adding new transaction.

Here we need to add the share information and control the purchase or sale via the transaction section of the share entry:

Share Purchase

Transaction type is Withdrawal

Share Sale

Transaction type is Deposit

Stock Portfolio Account

Our Stock Portfolio Account now displays a summary of the Stocks we have.

• The stock broker name is used to define the Stock Investment name.
• The companies we buy shares from become the share name
• Shares are generally associated with a Share Account having the same name as the company name.
• The Shares Accounts heading can be seen by using the menu View → Display Share Accounts

Example

Companies Alpha Corp and Beta Corp maintain their accounts with Yahoo Finance. Here we have hidden various headings as these become meaningless in this view.

Note: Initial share price is not listed in this view. This is because the share price becomes meaningless in a summary view as each purchase will generally have a different share price.

Stock Transaction List View

When we have added shares to our account we can see the associated share transactions using the View Transactions

Share Accounts

A Share account contain the transactions that are associated with this company stock.

Initially we would set aside money for investment in Stocks and Shares. This is achieved by transferring money from our general accounts to a Share account.

As shares are purchased and dividends received, we can now keep track of our investment over time.

In a transactions, we can also use the company name as a Payee. It is also advisable to create categories of:

• Share: Purchase
• Share: Dividend
• Share: Sale

Stock list from Portfolio view for our stock:

Adding Dividends to our Shares

Accessing our share account, we can add ordinary transactions to our shares account.

• A share dividend transaction becomes a normal transaction.
• The same rules for Income and Expense apply to share accounts when a transaction is created in the Account View.
• Actual commissions paid to a stock broker should also be recorded as a separate transaction.