I am also trying to figure out the best way to represent Sold options that
open new positions.
The suggested approach below works (kind of).
2020-12-28 * "Sell March 1 PUT 200 on HOOL"
Assets:Brokerage:Taxable:HOOL:Options -1 HOOL_PUT_200_2021_03_01 {1000
USD}
Assets:Brokerage:Taxable:Cash 1000 USD
Seems like I would need to add a new currency to HOOL:Options account each
time I open a new position. Overtime I suspect this may result in hundreds
(or even thousands) of currencies attached to a single account.
1) Is there any downside of attaching so many currencies to a single
account?
2) Is there a way to represent these transactions using the same currency
over and over (based on the cost basis and date of options)
2020-12-28 * "STO March 1 PUT 200 on HOOL"
Assets:Brokerage:Taxable:HOOL:Options -1 Options {1000 USD}
Assets:Brokerage:Taxable:Cash 1000 USD
2020-12-30 * "BTC March 1 PUT 200 on HOOL"
Assets:Brokerage:Taxable:HOOL:Options 1 Options {1000 USD} @ 990 USD
Assets:Brokerage:Taxable:Cash -990 USD
Income:PnL
On Tuesday, December 29, 2020 at 5:11:26 PM UTC-5 Rajath wrote:
> Two good approaches. The one where each option symbol is commoditized more
> inline with how stocks are managed. But the second approach is also very
> interesting because it accounts for assignment risk. My brokerage also
> holds the collateral from available cash when I sell a put option, so maybe
> I can find a way to represent that too (which says exactly how much cash I
> have on hand to trade).
>
> I will play around with this!
>
> On Tuesday, December 29, 2020 at 1:16:10 PM UTC-8 [email protected]
> wrote:
>
>> Hi,
>>
>> I count only the money in my account and control the sum of possible
>> assignments. I don't have an "entity" option.
>>
>> For the options, I sell puts of stocks I want to buy and I have the money
>> for doing it. So if it's assigned, no problem ;-)
>>
>> On Tue, Dec 29, 2020 at 6:47 PM Martin Blais <[email protected]> wrote:
>>
>>> On Tue, Dec 29, 2020 at 11:24 AM Tuno Tunante <[email protected]>
>>> wrote:
>>>
>>>> Hi,
>>>>
>>>> What I'm doing (I did the last yesterday) is like that:
>>>>
>>>> 2020-12-28 * "TD" "Sell Put MO 15 JAN 2021 Strike 40 @0.40" #Option #
>>>> Put #MO #Sell
>>>> Income:Options:TD -40.00 USD
>>>> Expenses:Comission:TD 0.67 USD
>>>> Assets:Account:TD 39.33 USD
>>>> Assets:Options 4000.00 USD
>>>> Liabilities:Opctions
>>>>
>>>>
>>>>
>>>>
>>>>
>>>>
>>> Where's the option?
>>>
>>>
>>> I do 6 or 7 per month. I use the Assets:Options and Liabilities:Options
>>>> in order to have a complete view about the money I must reserve in case
>>>> I'm
>>>> assigned.
>>>>
>>>
>>> Rule #1 of options trading: never get assigned! ;-)
>>>
>>>
>>>
>>>> Before each put, I check that Liabilities:Options is less that the
>>>> money in Assets:account:TD
>>>>
>>>> Regards.
>>>>
>>>>
>>>>
>>>> On Tue, Dec 29, 2020 at 6:18 AM Rajath Agasthya <[email protected]>
>>>> wrote:
>>>>
>>>>> Yeah, I figured each option could be a new commodity. I don't do a lot
>>>>> of option trades, so I'm okay with having more commodities until
>>>>> something
>>>>> better turns up.
>>>>>
>>>>> The thing I'm not sure of is how to represent a trade where I'm
>>>>> getting a credit (from selling a put or even a short sale of a stock). I
>>>>> can't quite seem to figure out the matching posting for this transaction
>>>>> if
>>>>> I represent receiving credit as a posting into a cash account such as
>>>>> Assets:US:Schwab:Cash. Any thoughts on how to do this or an example
>>>>> you can share?
>>>>>
>>>>> Thanks!
>>>>> On Monday, December 28, 2020 at 5:04:37 PM UTC-8 [email protected]
>>>>> wrote:
>>>>>
>>>>>> On Mon, Dec 28, 2020 at 5:47 PM Rajath Agasthya <[email protected]>
>>>>>> wrote:
>>>>>>
>>>>>>> Hi all,
>>>>>>>
>>>>>>> First of all, thanks to all the contributors (especially Martin) for
>>>>>>> this wonderful tool! I'm new to double entry accounting and Beancount,
>>>>>>> but
>>>>>>> I'm blown away at how simple yet powerful this tool is, especially when
>>>>>>> combined with Fava.
>>>>>>>
>>>>>>> I've been reading docs and I just started setting up my beancount
>>>>>>> file. But as I setup my investment account, I'm a little bit lost as to
>>>>>>> how
>>>>>>> I should manage option trades. The trades where there is a net debit is
>>>>>>> straightforward (I think), but I'm not sure how to enter trades like
>>>>>>> selling a covered call or a put or a spread/multi-leg option that
>>>>>>> result in
>>>>>>> a credit.
>>>>>>>
>>>>>>> Are there some examples I can refer to on how to manage option
>>>>>>> trades? The docs mention options trading as a future topic to be
>>>>>>> tackled
>>>>>>> and I unfortunately couldn't find anything in the mailing list (perhaps
>>>>>>> I
>>>>>>> didn't search properly). So if anyone can point me in the right
>>>>>>> direction,
>>>>>>> I would really appreciate it.
>>>>>>>
>>>>>>
>>>>>> I do options trading, but I only record simple options, never combos
>>>>>> like this.
>>>>>> - The option can be encoded in the symbol name. This makes a lot of
>>>>>> new commodities to declare and put out of commissions. I haven't yet
>>>>>> figured out what needs to be done to make this a bit nicer (e.g. allow
>>>>>> user
>>>>>> to define a commodity regex/pattern for these).
>>>>>> - For stable asset types, I use leaf subaccounts; for options I don't
>>>>>> (would be too many accounts, and it feels silly to create an account for
>>>>>> a
>>>>>> single position).
>>>>>> - For options combinations/"strategies", if you have some way to
>>>>>> trade all the legs instantly, you should be able to either (a) insert
>>>>>> all
>>>>>> the individual legs and their prices in a single transaction, or, if the
>>>>>> product is already securitized by your broker, trade it like any other
>>>>>> product (one leg with the derivative instrument).
>>>>>>
>>>>>> Hope this helps, you do have to get a bit creative if you trade
>>>>>> options, but, well, you trade options, so you will be able to figure out
>>>>>> something :-)
>>>>>>
>>>>>>
>>>>>>
>>>>>>>
>>>>>>> Thanks,
>>>>>>> Rajath
>>>>>>>
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>>>>>
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