Some stock splits may result in fractional shares, in which case manual adjustment is necessary.
Consider a (fictitious) example:
Before adjusting for stock split:
Open Shares: -162
|
Tr
|
Date
|
O/C
|
L/S
|
Ticker
|
Shares
|
Price
|
Comm
|
Amount
|
|
42
|
01/18/2024
|
O
|
L
|
ABC
|
325
|
$48.11
|
$7.52
|
($15,643.27)
|
|
42
|
01/19/2024
|
C
|
L
|
ABC
|
487
|
$32.20
|
$7.00
|
$15,674.40
|
-
On 1/18/2024, John bought 325 shares of ABC. A "3 for 2" stock split occurred on 1/19/2024.
-
Also on 1/19/2024, he sold 487 "post-split" shares so at the end of 1/19/2024 he did not have any shares of ABC still open.
Result after adjusting for stock split:
Open Shares: 0.5
|
Tr
|
Date
|
O/C
|
L/S
|
Ticker
|
Shares
|
Price
|
Comm
|
Amount
|
|
42
|
01/18/2024
|
O
|
L
|
ABC
|
487.5
|
$32.07333
|
$7.52
|
($15,643.27)
|
|
42
|
01/19/2024
|
C
|
L
|
ABC
|
487
|
$32.20
|
$7.00
|
$15,674.40
|
In the example above you will notice that ABC underwent a “3 for 2” split. At the time the split occurred, John held 325 shares open. Since this is a 3 for 2 stock split, the buy of 325 shares cannot be divided by 2 and multiplied by 3 equally. It comes up one-half share too high. The resulting number of shares is 487.5. Most likely the .5 share was distributed via cash in lieu of fractional shares in which case the .5 share needs to be removed from the Buy record and the Price needs to be adjusted so that the total Amount does not change.
To make the adjustment you should:
-
Select the Buy (open, long) record and from the Records menu, click Edit (or use F2 shortcut) to get rid of the .5 shares and change it to 487.
-
Change the price by subtracting the Commission from the Amount and dividing by the number of shares: $15,643.27 - $7.52 Commission = 15,635.75/ 487sh = 32.10626 (If you are adjusting an Open Short position you would add the commission amount before dividing by the number of shares.)
-
Note, the Amount should not change, only the Price
End result after adjusting shares and price:
Open Shares: 0
|
Tr
|
Date
|
O/C
|
L/S
|
Ticker
|
Shares
|
Price
|
Comm
|
Amount
|
|
42
|
01/18/2024
|
O
|
L
|
ABC
|
487
|
$32.10626
|
$7.52
|
($15,643.27)
|
|
42
|
01/19/2024
|
C
|
L
|
ABC
|
487
|
$32.20
|
$7.00
|
$15,674.40
|
Return to Adjusting for Stock Splits topic
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