Three choices on pricing a "derivative" fund (or stock for that matter) from
a 401k:

"$1 shares" All buys and sells use a $1 share price and the dollar value of
the transaction. (Money will calculate the shares--which, with $1 share
price, will always equal the dollar value of the transaction.) There is
never any reference to the reported NAVs. When the investment gains or
looses value, then the difference between investment value and the shares/$
value in Money is added or removed using Add Shares/Remove Shares
transactions for the dollar value of the difference using the same $1 share
price. This is just like how money market funds are handled, but you have to
enter the $1 price yourself.

Use the reported units and unit prices. This is just like any real
market-traded investment except you can't download the NAVs. For this to
work your plan has to be better than mine is in terms of always giving you
the units/unit value for transactions. You also have to be willing to go
find and enter this for every transaction.

"1 share" Use a single share and just keep changing the "quote" for that
single share. Beyond the first 1 share you buy, you never add Buy or Sell
transactions (or any other), until you dispose of the entire investment and
sell the 1 share. You just keep updating the per share price to match the
value of the 1 share investment you hold.

Hope this helps.

"Mark Dekovic" <mark.dekovic[at]hotmail.com> wrote in message
news:exkPXzCOEHA.3832[at]TK2MSFTNGP10.phx.gbl...
- quote -

Thanks Dick,

That sheds some light on the subject and I appreciate you sharing your
method of tracking that type of investment. I'd like to know a little more
because I'm not completely clear on what you mean by "$1 shares." When you
record a purchase in the investment you record the dollar amount but not the
number of shares? or just one share until you can adjust the share count
from your statement? is that right?


"Dick Watson" <littlegreengecko[at]mind-enufalready-spring.com> wrote in
message news:uZwwM02NEHA.1608[at]TK2MSFTNGP12.phx.gbl...
- quote -

In microsoft.public.money, Mark Dekovic wrote:

- quote -

They are different versions of the funds. Sometimes the retirement
version is saddled with an additional fee that funds the 401k
administration. That seems to be more common today-- let the
employees pay for the admin rather than the company eating the
expense. If you see the fund under-performing DODGX by a quarter to
half a percent every year, that would bear out my theory.

This kind of thing makes rolling your 401K into a rollover IRA more
desirable for more people after leaving the company than it used to
be. I am not equipped to compare the rollover IRA's potential
downside of being more accessible to lawsuit or means testing.

It is probable that your fund has no public symbol, so Money will
not be able to download published NAVs.

- quote -

You will only be able to do so if your plan or the mutual fund
company provides the data.

- quote -

Many 401(k) plans offer funds that are **not quite** the real funds. They
buy/sell the underlying funds in bulk based on the aggregate of plan member
activities. In many cases, they keep some amount of the aggregate holdings
of the plan fund in cash to preserve some liquid hedge against big movements
in plan fund holdings or the underlying security in a given day. In some
cases, they also scrape some of this off to pay fund expenses.

This is all why you cannot use the symbol/NAV of the underlying fund for
your Money investment and why, if you do, they won't track over time.

Because all of these plan mechanics are not completely transparent and
exposed to you--and life would be too short to actually try to duplicate
their accounting anyway--there is no good way to accurately track them
exactly--you will ultimately have to resort to accepting the statement
balances as they reflect fund value gain/loss.

What I do is:

a) Track the real fund with a Money Investment and the correct symbol as an
investment in the Investment to Watch Account. (Like "Vanguard Windsor",
symbol VWNDX.)
b) Create a Money Investment, with no symbol, for the investment holding in
the Money 401k Account. (Like "Savings Plan VWNDX", no symbol entered.)
c) Buy and sell the 401(k) investment using $1 shares. This makes the Buy
Investment transactions entered in the Cash Account easy to do without
having to compute anything besides the percentage allocations across funds.
d) Occasionally update the share holdings (=statement values, given the $1
shares) with Add/Remove Shares transactions using the Account Summary|Quick
Update tool.

You can use the plan NAVs per share if they routinely report it that way. My
plan doesn't issue all data based on units/unit value, just some of it, so
it has been easier for me to use the $1 shares. In some places in Money
help, they recommend 1 share at the current statement value. In that
scenario, you can never enter buys/sells to match your activity. I think
that the $1 shares method work out much better than the 1 share method.

I'm not sure what kind of help you would be expecting from Microsoft on this
issue--the plans create it, not Microsoft or Money. I agree that Money (and
the entire financial industry) could do a better job helping us to manage
these private derivative investments.

Hope this helps.

"Mark Dekovic" <mark.dekovic[at]hotmail.com> wrote in message
news:ODJtTX2NEHA.3944[at]tk2msftngp13.phx.gbl...
- quote -

I have a situation where a mutual fund in my 401(k) has a stock id but the
shares/cost are totally different. Example: DODGX is currently trading at
$112. My 401(k) represents its value (NAV) at $13.

Why the disparity? And is there a way to accurately track the investment's
value in Money as well as activity; in particular, BUYS. When I first set up
the investment account I created a cash account that goes with it so that
Money will at least record income in the cash account when I get my
paycheck. Then I manually (not to mention, painstakingly) calculate the
percentage of shares and cost (401k versus market) and enter in an adjusted
share amount to keep the resulting market value in the ballpark.

I'm curious as to how others deal with the situation and if there's any help
from Microsoft on the issue.

thanks
mark