Foreign stock purchase with domestic currency trading commission

[David Carlson]

On 4/11/2015 11:46 AM, geoff at wrightville.org wrote:
> Wow. Did not even know there was a trading accounts feature. Will investigate tonight and report back. My other thought was to disassociate the brokerage fees from each individual trade and just stick these fees in a separate account.
>
> Thanks for the tip about trading accounts.
>
> Geoff
> -----Original Message-----
> From: Edward Doolittle <edward.doolittle at gmail.com>
> Date: Sat, 11 Apr 2015 10:20:35
> To: Geoff<geoff at wrightville.org>
> Cc: gnucash-user at gnucash.org<gnucash-user at gnucash.org>
> Subject: Re: Foreign stock purchase with domestic currency trading commission
>
> Are you using trading accounts? If not, would you be willing to switch the feature on?
>
> Sent from my iPhone
>
>> On Apr 11, 2015, at 6:16 AM, Geoff <geoff at wrightville.org> wrote:
>>
>> I have read the gnucash documentation regarding a foreign currency stock transaction but was unable to find the following use case.
>>
>> Section 10.4.2 — Purchasing foreign stocks — provides a good description of how to record foreign stock purchases but does not explain how to record a trading fee on the transaction.
>>
>> If the trading fee is also foreign currency denominated, everything works perfectly. However, in my case, I have an account that charges a domestic currency trading fee and here I seem to run into the problem that a single split can only seem to handle one currency.
>>
>> If I force the purchase of the stock to a foreign currency then the commission is also recorded as foreign currency and changes through time as exchange rates move. What I need is that the commission remains fixed in the domestic currency.
>>
>> Does anyone have any advice about how to record this transaction in a way that would preserve the ability to correctly show the commission in the “Advanced Portfolio” report ?
>>
>> Thanks in advance
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While I think that trading accounts are probably the best way to go, I 
am leery about turning them on without a lot of testing to see how they 
work for my data.  Thus I will warn you to try running a test file next 
to your primary file until you are comfortable with whichever decision 
you make.  I think it is difficult to back out the changes if you decide 
after a few weeks that you should not have done that.

I think that GnuCash may not handle a stock correctly if it is held in a 
security account that has a different currency than the parent brokerage 
account, but I do not have direct experience with that use case.  Maybe 
that is where trading accounts make it work.

David C