Net Cost vs Purchase Value

[metal450]

I’m using PP to track my crypto holdings, alongside Blockfolio. I’m having trouble wrapping my head around „Purchase Value,“ as the numbers I’m getting don’t seem to make sense - nor do they match Blockfolio. Consider a security with:

$50 BUY
-$25.02 SELL
$200 BUY
-$149.68 SELL

My cost was 50-25.02+200-149.68=$75.3. That’s how much my current holdings cost me in my own, real, original dollars invested - and it’s exactly what Blockfolio lists as „net cost“ (sum of all costs from purchases - sum of all proceeds from sells). Profit/loss is then Market Value - Net Cost, and Avg Net Cost = Net Cost / Holdings. All very straightforward & makes sense to me.

However, in PP’s Statement of Assets, „Purchase Value“ is 70.08 & Purchase Value (MA) is 70.04. I find these numbers much less intuitive, and as far as I can tell, don’t really provide any way to tell „how much of my original money is currently invested“ (?). The corresponding Purchase Price and Profit/Loss don’t seem logical to me either. For example, although I know I paid $75.3 out of my own money (per above), if today’s market value were 70.08, PP would show $0 profit/loss. It seems to me that that’s actually a ~$5 loss, since I put in $~75 and now it’s worth ~$70.

Am I missing something here?

And more importantly: is there some way to view NET COST, AVG NET COST, and PROFIT/LOSS as calculated by Blockfolio - so I can keep the two accounting methods coherent, & also because it just seems a lot easier to understand that way?

Thanks in advance for any thoughts!

[hier_und_dort]

Hi @metal450 and everyone,

Did you find any good answer to this? I have the exact same problem:

@metal450

I’m having trouble wrapping my head around „Purchase Value,“ as the numbers I’m getting don’t seem to make sense

@metal450

I find these numbers much less intuitive, and as far as I can tell, don’t really provide any way to tell „how much of my original money is currently invested“

Specifically, see the picture below:

It lists all the transactions for an ETF carried out by a “robo-advisor”, imported from various PDF files. All the imported values are 100% correct.

So, as of now I have 5.242 shares which have cost 347.12 EUR of my own money (net cost).
I would expect the net unit price to be 347.12 / 5.242 = 66.22 EUR/unit.

Here’s what PP says:

No idea how to get that 74.28 unit price.
I can only note that 389.35/74.28 = 5.24165 which is close enough to what the ratio should be (5.242) so I suppose some rounding has some impact. Other than that, no clue.

Any thoughts?
Thank you in advance!

[mtosques]

Where did you get the first picture? Which tab?

[hier_und_dort]

“Statement of Assets”.
Then I simply clicked on the security (XTRACKERS S&P 500 SWAP…) in the upper window and selected “Transactions” in the lower window.

[mtosques]

Maybe you’re showing values in EUR instead of USD (or vice versa)?
And the ratio looking similar because EUR/USD has been aroud 1 lately?

First image is something like you would expect.

The following is switching to USD

[hier_und_dort]

I thought about some EUR/USD confusion too, given that this ETF is for an S&P500 security.

But then again, the ETF is denominated in EUR:

and so are all the values imported (correctly) from the PDF invoices.
Also, in the Statement of Assets I am displaying values in EUR.

This ETF was maybe not the best choice, I could repeat the same exercise for another one.

Still, I think this issue popped up in @metal450 's case too while working with USD, and it is probably the same as here .

[hier_und_dort]

@hier_und_dort

This ETF was maybe not the best choice, I could repeat the same exercise for another one.

Alright, this DAX ETF is looking a lot better:

I’ll try to investigate some more tomorrow what could have gone wrong with the S&P 500

[chirlu]

The usual reason for “wrong” values is that the reporting period doesn’t comprise all the transactions.

[hier_und_dort]

I finally figured it out: it is because of FIFO.

Whenever sales are carried out, the oldest shares leave the account first and at that point the Purchase Price is recalculated on the remaining shares. For example, if you sell a lot of old shares that happen to be cheap, the new Purchase Value could increase noticeably.

Basically I was able to reproduce the exact same PP value by manually doing what you see under the “Trades” tab for a given security:

and recalculating the Purchase Value at each step.

Many thanks to @mtosques and @chirlu for pitching in, and I hope this can be helpul to other users who might get confused by the same thing.