FX Cash Transactions

[BradN]

Hi Mark,

I am trying to get a CAD buy to hit my USD cash acct. I have set up the accounts and exchange rates as per the documentation.

I have 2 sub portfolio's. One for USD and one for CAD. When I make a purchase of CAD I would like to see a sell in the USD Cash account. I am wondering if the hierarchy is wrong. Both accts are at the same level. Does the CAD have to be under the USD portfolio for me to pull this off?

Thanks,

Brad

[Mark]

Hi Brad,

To do this you would need to specify the USD cash investment in the USD sub-portfolio as your default cash account for your CAD sub-portfolio. This means that all transactions that use/generate cash in your CAD sub-portfolio will use the USD cash investment. If that is what you want, you can do this. It does not matter where in the hierarchy the 2 sub-portfolios are located. To assign the USD cash investment to the CAD sub-portfolio, edit the properties of the CAD sub-portfolio, and next to the "Default Cash Account" option, check the box that says "Show All". Once you do this, every investment in all sub-portfolios will be in the drop-down for you to choose from. Just pick the USD cash investment to make that the default cash account for this CAD sub-portfolio.

When you record/import transactions, the currently recorded exchange rate will be used to debit/credit the USD cash account based on the recorded CAD transaction amount.

[BradN]

Mark,

Thanks for the suggestion, I love these peeks into your program.

The flip side is that when I purchase a CAD equity in the CAD sub portfolio, that transaction is applied to USD cash. Is this a case of damned if I do/ damned if I don't?

What is the optimal way to set this up? I adlibbed the currency sub portfolios b/c the IB .OFX data made such a mess of thing upon import. Now that I have reconciled 2010 I will import the IB .trn files for 2011 and beyond. Any ideas as to how I can set up these portfolios resulting in a clean upload?

Thanks,

Brad

[Mark]

Hi Brad,

Correct, if you assign a default cash account to a sub-portfolio, all transactions recorded in that sub-portfolio will use the default cash account. You can't separate which cash account to use based on the type of transaction. If necessary, you can choose to not use a default cash account, and record the corresponding entries the way you want.

I would say the optimal way to set things up is to mirror what is really happening in your brokerage account. How is your account really set up, and what is wrong when you do the OFX import?