[Patch] reworked advanced-portfolio.scm

Andrew Sackville-West andrew at farwestbilliards.com
Sat Feb 18 20:42:21 EST 2006


On Sat, 18 Feb 2006 18:38:27 -0700
Mark Johnson <mrj001 at shaw.ca> wrote:

> Andrew Sackville-West wrote:
> 
> >On Sat, 18 Feb 2006 10:20:24 -0700
> >Mark Johnson <mrj001 at shaw.ca> wrote:
> >  
> >
> [...]
> 
> >>True.  What about the possibility of reports based upon the pricedb 
> >>entries?  Eg. a graph of the price history.  Such entries would produce 
> >>unwelcome blips.  I'm just thinking here about possible future features, 
> >>and, I suppose, the meaning of pricedb entries.
> >>    
> >>
> >
> >In thinking on this more, as I understand the way the report currently
> >works, that shouldn't necessarily cause a blip. The report takes the
> >txn and converts it from whatever commodity it is currently represented
> >in to the final display commodity(currency). Frankly, I don't
> >understand the currency exchange function well enough yet to know, but
> >it may be that it correctly shows a conversion. so for example if you
> >have 10 units stockA @ $10 and trade it for 5 units stockB @ $20, then
> >the value should line up at $100 either way. What if your trade is not
> >1:1. hmmm.  10units A @ $10 becomes 7 units B @ $20. well your value
> >jumps from $100 to $140. but this is still accurate as that is what the
> >stock is worth. What am I missing here?
> >
> >  
> >
> The bit that you are missing is that the conversion from one fund to 
> another uses the cost basis rather than the market value as the dollar 
> amounts.  Suppose I bought the fund some years ago (true), and suppose 
> it has gone up in value significantly since then (sadly not true).  Now 
> if the conversion from one fund to another at original cost places an 
> entry in the pricedb, that entry will be the cost of the mutual fund, 
> not the current market value.  Since the cost and market value are now 
> significantly different, this entry would produce a large, short, 
> downward blip in a (hypothetical) graph of the prices in the pricedb.
> 
> The point I am trying to make is that we should not automatically create 
> entries in pricedb for transactions that do not reflect the current 
> market value.

agreed. I do think, however that a pricedb entry for any actual buy or
sell is valid. Regardless, we're getting off track on the actual report
and its expected behavior. I think I'll put together a nice example
with expected results from the report and get some feedback on that. 

thanks for working throuhg this with me. I appreciate it very much.

A
> 
> Mark
> 
> 
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