Online Investing: Some Mechanical Problems with the IRR

Online Investing Now that you understand the basic logic of the IRR tool, you should know that the IRR, for all of its usefulness, isn’t flawless. Quicken (and every other investment record-keeper’s computer program) calculates a daily IRR and then multiplies this percentage by the number of days in a year to get an equivalent annual IRR. Continue reading

Describing the Bonds You Sell

Online Investing Describing the bonds you sell is easy as long as you have the necessary information: the number of bonds sold, the price per share (or the transaction total), and the commission paid (if any). You also need to know the amount of accrued interest you will be paid. As with other investment transactions, you can record bond sales either directly into the register or by using an investment form; using an investment form is easier. Continue reading

Recording Accrued Interest Shown on a 1099-OID

Online InvestingYou aren’t always paid the interest that you’ve earned. If you purchase a negotiable certificate of deposit (CD), for example, the bank issuing the CD may accrue the interest you’ve earned through the end of the year and then add this amount to the CD’s value. If you purchase a zero-coupon bond, you don’t receive periodic interest payments at all. Rather, the bond issuer accrues interest each year and then repays the bond and the total accrued interest at maturity Continue reading

Online investing: Describing Bond Purchases

Online Investing Whenever you buy additional bonds, you need to record the purchase and any accrued interest, so you actually record two transactions. As with stocks and mutual funds, you can record bond purchases directly into the register or by using an investment form. Because the investment form approach is easier, it’s the one we’ll describe here. Continue reading