Sounds like the cost basis transfers over. If so, you can account for this
by making the *total* basis of your new lots equal to the total basis of
the original lots.
The easiest way to do it is the total cost syntax using double curlys, but
if the division ends up being irrational, you can get a large number of
digits which looks kinda ugly. So may be worth doing the math yourself.
In your case the original basis was 15000 USD, so the new VTSAX basis
should be 150000/87.5 == 171.43 USD per share.
2010-01-31 * "Vanguard" "Convert VTSMX to VTSAX"
Assets:Vanguard:VTSAX 87.5 VTSAX {171.43 USD} @ 200 USD
Assets:Vanguard:VTSMX -100 VTSMX {150.00 USD} @ 175.00 USD
The total cost basis way:
2010-01-31 * "Vanguard" "Convert VTSMX to VTSAX"
Assets:Vanguard:VTSAX 87.5 VTSAX {{15000 USD}} @ 200 USD
Assets:Vanguard:VTSMX -100 VTSMX {150.00 USD} @ 175.00 USD
On Tue, Dec 14, 2021 at 10:00 AM Hardy Jones <[email protected]> wrote:
> I've got an issue that I cannot figure out. I've tried searching here, on
> GitHub, and reading the docs. But, I'm a bit stuck on what to do.
>
> Vanguard has three different share classes
> <https://investor.vanguard.com/mutual-funds/share-classes>. The important
> ones for this situation are: Investor and Admiral. The Investor shares have
> a higher expense ratio, but a lower minimum. The Admiral shares have a
> lower expense ratio, but a higher minimum. The idea there being that if you
> cannot afford the minimum for Admiral shares, you can buy the Investor
> shares instead.
>
> Vanguard also allows converting Investor shares to Admiral shares
> <https://investor.vanguard.com/mutual-funds/convert-to-admiral-shares> if
> you qualify. The idea there being you might buy some Investor shares over
> time until you get enough to meet the minimum. The conversion is tax-free,
> and there are no fees.
>
> The issue I'm running into is how do I track this with Beancount? Let's
> make up some numbers and say I do the naïve thing of buying 100 shares of
> VTSMX (an Investor class) at $150.00/share:
>
> 2010-01-01 * "Vanguard" "Buy VTSMX"
> Assets:Checking -15,000.00 USD
> Assets:Vanguard:VTSMX 100 VTSMX {150.00 USD}
>
> At the end of the month, I log onto Vanguard's website and convert from
> VTSMX to VTSAX. In that time, the price of VTSMX has gone up to
> $175.00/share. The price of VTSAX is $200.00/share. Since this is using
> Vanguard's conversion, there is no buy/sell event for the shares so no
> taxes and not profit/loss. Ideally, I'd be able to enter a transaction like:
>
> 2010-01-31 * "Vanguard" "Convert VTSMX to VTSAX"
> Assets:Vanguard:VTSAX 87.5 VTSAX {200.00 USD}
> Assets:Vanguard:VTSMX -100 VTSMX {150.00 USD} @ 175.00 USD
>
> But, this doesn't balance. There's $2,500.00 that needs to be accounted
> for. There needs to be another posting to balance the transaction, but what
> is that other posting? On my statement there is only one "Conversion (in)"
> and one "Conversion (out)" transaction. There are no realized gains or
> losses from this conversion, no money moves to a settlement account or
> anything. No taxes had to be paid, etc.
>
> It doesn't seem right to make up some fake account to dump the difference
> into only so the transaction balances, but that's the best I can come up
> with. Any other ideas about what to do, or maybe what I can do differently
> to track this correctly?
>
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