It has been bothering club members that our investment of
FTDI is not showing up correctly on our statement. Here
is the history....

We bought EFTD on 5/23/01 for $6.00 a share for $16.168
shares ($97.01 purchase + $2.99 fee = $100 purchace total).

The parent company FTDI merged EFTD into them on 6/27/02.
At the time EFTD was worth $3.21 a share. The merger was
.26 shares of FTDI for each EFTD share, so we wound up with
4.203 shares of EFTD at an effective cost of $12.35 a share
at the merger time.

How should this all show up? BIVIO is showing a gain on
the FTDI price, using the $12.35 value as the average
purchase price. That means the gain is about 75%, since
the total value is now $115 or so and it was a total value
of $51.90 at the time of merger.

In my mind, the investment is on the original $100 spent, so
the gain is more like 15%.

My question after all this is : How is this normally done?
I must have entered something incorrectly like a sell of
one, then a buy of the other instead of using the merger
option.

I think it is wrong, so how do I fix it?

- bettyd

Elizabeth Darling wrote:
> We bought EFTD on 5/23/01 for $6.00 a share for $16.168
> shares ($97.01 purchase + $2.99 fee = $100 purchace total).
 
When the merger occurs, the entire cost basis of the stock is
transferred into the new investment. So the total cost basis of the
FTDI is $100. Any gain/loss of the new investment will be relative
to the $100 cost basis.
 
Paul Moeller
bivio Inc.