Share splits inaccurate data


C

Chris Elford

When I split shares the daily change amount does not take the split into
account. For example, if shares split 2 for 1 the price divides in half but
the shares double for no change. But MS Money tells me that the price dropped
by 50% for the day of the split. Is there anything that can be done to fix
this?

MS Money Standard - Canada

Thanks in advance.

Chris Elford
 
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W

Wally

Check to see if the split is recorded on the proper day by going to your
investment and chosing Update prices manually. The split should appear here
on the proper date. All historical prices prior to the date of the split
should adjusted and should have an "s" following them. Let me know if you
are still having problems.
 
C

Chris Elford

Wally,

Thanks for your reply.

I need to be more specific. The price difference is only wrong for one
day--the day the share prices change on the exchange. I checked the split and
it was on the right day. In fact the shares split on Monday so I'd recorded
the split as happening on Saturday.

Here's the details:

Canadian National Railroad (CA:CNR) Friday Feb. 17 price: $108.30
Split 2:1 on Saturday Feb 18 (actually on Monday Feb 20)
Price on Monday Feb 20: $53.98

MS Money shows this as a loss of $54.32 instead of a loss of $0.34. Plus it
shows the difference for the day as $54.32 * the number of shares. It
accurately computes the value of my holdings, but throws off the account
daily change and percentage change as well.

Thanks again for your reply. I hope this extra detail makes the question
clearer.

Chris
 
C

Chris Elford

Thanks for this reference, Mark. It seems strange that the program has to
wait until the next night to get the split update and doesn't just compare
the value on each day with the value from the previous day (current share
value * number of shares held - previous day value * previous day share
holding).

Chris
 
D

Dick Watson

I don't bet they "figure out" a split as you suggest. (I'm not clear on how
what you suggest would work in the case of quote data that knows nothing of
shares held.) I'm betting they depend on some explicit data in the stream
they get from their information feed (e.g., Comstock). I'm also betting that
data comes with the delay you are concerned about.
 
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C

Chris Elford

Dick,

My concern is about the "Total Change" Column which identifies the
difference in the value of a holding from one day to the next. I'm not sure
how it could be calculated if it doesn't use the number of shares held. The
column is labeled as "How much the total value of your investment changed
today."

When it uses the wrong values it produces a bogus difference which is
reflected in the rest of the calculations. If you have a lot of shares
splitting over the period of a few days--and that can happen--you continually
have bogus information. That makes the program less useful to someone who is
using it mainly for investments. Since those of us in Canada can't get any
other version but the Standard, it makes it less desirable.

This problem should have nothing to do with the data provider as I see it.

Chris
 
D

Dick Watson

As noted, I do not think Money attempts to guess when a split has occurred.
Yes, I suspect it is entirely possible this can lead to bad reporting while
all of the data sorts itself out.

Chris Elford said:
My concern is about the "Total Change" Column which identifies the
difference in the value of a holding from one day to the next. I'm not
sure
how it could be calculated if it doesn't use the number of shares held.
Sure it uses number of shares. It uses that and the reported per share value
to report the total change column. But if it doesn't yet know that the
number of shares you hold doubled, say a 2:1 split, it will probably report
a pretty drastic drop in value until is knows about the split and doubles
the number of shares. What I'm saying is that it doesn't use the singular
fact that the price is half today what it was yesterday to figure out that a
2:1 split has occured. It MAY get data in the quotes download telling it a
2:1 split has occured. If this happens a day after, well, then, it's going
to look like a brutal drop in value for a day. Actually, I'm not sure it
gets the split data that way. It may wait until you enter it manually or it
may wait until you download an investmtent transaction from the broker/FI
telling it about the split for your shares. Again, what I'm saying is that
it doesn't use the singular fact that the price quote it downloaded today is
half what it was yesterday to infer that a 2:1 split has occured.
The
column is labeled as "How much the total value of your investment changed
today."

When it uses the wrong values it produces a bogus difference which is
reflected in the rest of the calculations. If you have a lot of shares
splitting over the period of a few days--and that can happen--you
continually
have bogus information. That makes the program less useful to someone who
is
using it mainly for investments. Since those of us in Canada can't get any
other version but the Standard, it makes it less desirable.
You are just now discovering that Money is not a terribly sophisticated
investment management program?
This problem should have nothing to do with the data provider as I see it.
And I'm not saying that the "problem" comes from the data provider. I'm
saying that Money doesn't use the singular fact that the price quote it
downloaded today is half what it was yesterday to infer that a 2:1 split has
occurred. Something besides the quote has to explicitly tell it about the
split and then Money has to adjust your number of shares accordingly.
 
C

Chris Elford

Dick,

Thanks for your response. First, I am in Canada and we don't have the links
to brokers because we can only get the Standard version of MSMoney, so that
doesn't relate to my issue.

In Canada, we also have to manually split shares, which I did during the
weekend two days before the data was wonky. So, that doesn't relate to my
problem.

All the other calculations are accurate. Money doesn't get the market value
of my holdings wrong, just the difference in value. If it is using the
difference in share value from the previous day to calculate the difference
in total value, how does it do that without reference to the number of
shares? It does reference the number of shares in calculating the total value
so why not the other number. I don't think that relates to my problem.

In any event, if what you are saying is true, that seems pretty poor design
for a program that is supposed to provide you with minute by minute portfolio
value. Cheap price, cheap program?

Chris
 
D

Dick Watson

Comments below.

Chris Elford said:
In Canada, we also have to manually split shares, which I did during the
weekend two days before the data was wonky. So, that doesn't relate to my
problem.

All the other calculations are accurate. Money doesn't get the market value
of my holdings wrong, just the difference in value. If it is using the
difference in share value from the previous day to calculate the difference
in total value, how does it do that without reference to the number of
shares? It does reference the number of shares in calculating the total value
so why not the other number. I don't think that relates to my problem.
It's entirely possible they calculate change in value as:

(numshares * sharevalue) - (numshares * (sharevalue + deltavalue))

without regard to the numshares from yesterday.

Why would they do it? Beacuse it was fast and easy and for most users and
most cases and most situations, close enough. When your goal is to put out
just enough cheese to drag eyeballs to ads, the cheese can be pretty low
grade. Very, very, few Money users are sophisticated enough to be able to
audit these numbers and identify that they are wrong in any given
circumstance. Worse, it's clear that the people designing and building Money
don't actually use it to do real work besides test cases. How else can you
explain things like requiring a number of shares when scheduling a future
investment purchase?
In any event, if what you are saying is true, that seems pretty poor design
for a program that is supposed to provide you with minute by minute portfolio
value. Cheap price, cheap program?
I don't think Money has ever claimed to provide minute by minute portfolio
value. (And I am clueless why they get quotes every 30 minutes if you turn
that on.) It is not for granular management and analysis and/or
sophisticated investors. Look what tools like MetaStock cost. OTOH, Money is
designed to appeal to an ever-lower-common-denominator of user who thinks
$20 is too much too pay when you can steal it.
 
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C

Chris Elford

I think you are probably right. Delta would answer their immediate need.

I think you are also right about the lowest denominator. Too bad, because I
would think there may be a market for a midrange product for investors who
want to monitor their portfolios but don't have time for detailed analysis
and stock watching.

Chris
 

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