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MUTUAL FUND EXPERT ACCOUNTING PROGRAM Version 2.4 by: George R. Cotten 37 Lawrence Lane Lexington, MA 02173 1 FundExpert ACCOUNTING PROGRAM This program is being distributed under the shareware concept. The program and this manual are the copyrighted property of the author. You are granted a limited license to try the program for one month, to copy it and distribute it, provided that: a) You do not charge a fee for the distribution or copying of the program unless you have the prior written consent of the author, b) It is distributed only in its original, unmodified, compiled form (except that it may be compressed using an archiving facility, as long as the program can be uncompressed only back to its original form), c) This documentation file accompanies the program itself, and is also distributed in its original, unmodified form (or compressed - see exception in item b above), and, d) It is not distributed as part of any commercial product or service without the prior written consent of the author. After trying the program, if you decide to use it, please return the license agreement/registration form, signed, (at the end of this manual) along with the registration fee of $40.00. Registration entitles you to use the program on one computer or local area network (LAN) at a time. LAN support is NOT provided. If used on a network, it is at your own discretion. Site licenses are also available for an additional fee as explained in the license agreement/registration form. Registered users can obtain technical support and will be notified about future revisions. CAUTION! ───────────────────────────────────── Although the program FundExpert may be useful for most investors, and the author did his best to minimize bugs, he cannot underwrite everyone's investment decisions or business use of this product. Before using this program you should recognize that it involves a high level of complexity which is potentially susceptible to error either in the program code itself or on your part due to incorrect usage. Thus you should understand that you use and rely upon the results of FundExpert at your own risk. You should satisfy yourself regarding the adequacy and accuracy of FundExpert with test examples before committing to using and relying upon the program on a regular basis. You should furthermore review all program output for reasonableness before using it to make investment decisions. 2 TABLE OF CONTENTS Files on the disk . . . . . . . . . . . . . . . . . . . . . . . 4 Introduction . . . . . . . . . . . . . . . . . . . . . . . . . 5 CHAPTER ONE Installation .. . . . . . . . . . . . . . . . 6 Installation . . . . . . . . . .. . . . . . . . . . . . . . . . .6 Program Configuration. . . . . . . . . . . . . . . . . . . . . . 6 Initial menu . . . . . . . . . .. . . . . . . . . . . . . . . . .7 Program's limitations . . . . . . . . . . . . . . . . . . . . . 8 CHAPTER TWO Using FundExpert program . . . . . . . . . . 9 Adding new accounts . . . . . . . . . . . . . . . . . . . . . .10 Deleting existing accounts . . . . . . . . . . . . . . . . . . 10 Sorting of existing accounts . . . . . . . . . . . . . . . . . 10 Connecting to the Host Computer . . . . . .. . . . . . . . . . .10 Share prices, yields, and no. of shares . .. . . . . . . . . . .11 Account balance and recent activity . . . . . . . . . . . . . . .12 Transfer of shares between accounts . . . . . . . . . . . . . . .12 Transfer of funds from a bank . . . . . . . . . . . . . . . . . .13 Gain/Loss from transactions . . . . . . . .. . . . . . . . . . . 13 Transaction log . . . . . . . . . . . . . . . . . . . . . . . . .14 Printing . . . . . . . . . . . . . . . . . . . . . . . . . . . .15 Fidelity Brokerage . . . . . . . . . . . . . . . . . . . . . . . 15 Downloading quotations . . . . . . . . . . . . . . . . . . . . . 16 3 CHAPTER THREE Stock Market . . . . . . . . . . . . . . . . 18 CHAPTER FOUR Bonds portfolio . . . . . . . . . . . . . . . 19 CHAPTER FIVE Bank accounts . . . . . . . . . . . . . . . .20 CHAPTER SIX Other features . . . . . . . . . . . . . .21 Customized dialing . . . . . . . . . . . . . . . . . . . . . . . . 21 Yield of Bonds . . . . . . . . . . . . . . .. . . . . . . . . . . .21 Summary of investments . . . . . . . . . . .. . . . . . . . . . . .22 UTILITY PROGRAMS . . . . . . . . . . . . . .. . . . . . . . . . . .22 "Pre-dated" entries . . . . . . . . . . . .. . . . . . . . . . . .22 View/delete files . . . . . . . . . . . . . . . . . . . . . . . . 22 Capital gains calculation . . . . . . . . . . . . . . . . . . . . 23 Plotting module . . . . . . . . . . . . . . . . . . . . . . . . . .24 LICENSE AGREEMENT . . . . . . . . . . . . . . . . . . . . . 25 REGISTRATION . . . . . . . . . . . . . . . . . . . . . . . . 26 LIMITED WARRANTY . . . . . . . . . . .. . . . . . . . . . . .27 4 -------------------- Files on the Disk: -------------------- There are three program files on the distribution diskette: INSTALL.EXE, README.1ST and FUND.OVR. The program is self-installing and you will find the following files on your disk: FUNDS.EXE and FUNDS.OVR is the actual program, FUNDS.CFG is the configuration file for the program *.ACT and *.STK are the data files for different accounts SHARE.LOG is the log of all transactions SHARE.ARC contains archived transactions and is formed when needed COPY.DAT is a copy of "account screens" and is formed when needed SALES.LOG listing of "closed" positions and is formed when needed MANUAL.DOC is the instruction manual LICENSE.DOC is the license agreement ---------------- Introduction ---------------- The program FundExpert automates the access to many families of mutual funds using automated service telephones. The program permits a speedy, access to these funds: obtaining individual quotations and balances including the last purchase/sale/exchange of shares in your account. An additional feature is the automated transfer of funds from your bank to some groups of funds, or between funds in certain groups. The program maintains a record of all the transactions and calculates the actual return on investment in these funds, taking into account dividends and the change in share price. The price quotations for different stocks, funds, or bonds can be also downloaded from Prodigy(R) and/or CompuServe(R). Any changes in price are automatically recorded by the program and can be subsequently plotted. A separate section of the program permits compilation of all investments in Treasury, Municipal and Corporate bonds. The yield to maturity of these bonds is calculated and payment dates listed. If an interest payment is due within 30 days, then this entry is highlighted for your convenience. Another section is devoted to direct investments in the stock market, and a routine is provided for making buy/sell orders by telephone, directly to the host computer at Fidelity Brokerage. There is also a section for recording your investments in bank accounts, such as Certificates of Deposit, or Money Market accounts. 5 Any sales, or purchases of shares, or bonds, can be recorded by simply moving the cursor to the desired location (with the arrow keys) and changing the respective numbers. The program will record automatically each such change as purchase or sale. The program maintains a permanent record of all transactions, calculates the actual yield on investment for individual accounts as well as provides the "purchase date and price" and "selling date and price" for all "closed positions", according to IRS rule FIFO (ie. "First in, first out"). You may try this demo for a limited time period. At the end of your trial, you are invited to register and then you will receive a personalized copy of the program, be given access to technical assistance and notified about future improvements. 6 CHAPTER ONE Installation ---------------------------------------------------------------------- Please read the license agreement and warranty information found at the end of this manual for more information regarding the use of the program. ------------------ Installation ------------------ To install the FundExpert on a hard disk, put the master disk into Drive A: or Drive B; , and type the following: INSTALL <ENTER> This will initiate the installation process during which you will be given an opportunity to select the drive and directory where you wish to store the program. Alternatively, you may copy all the files to the desired directory on your hard disk, change to that directory, and then type: INSTALL <ENTER>. After you have installed the program in your computer, you are ready to start the program. The first time that you use the program, you will go directly to the "configuration menu" (see below). ------------------------ Program configuration ------------------------ The program is started by changing to the appropriate sub-directory (eg. \FUND) and issuing the command FUNDS, ie. type: C: cd \FUND FUNDS At the first start-up of the program you will be presented with the configuration routine. This routine can be reached at any other time by pressing ALT F1, when you are in the "Mutual Funds" section of the program., or through the Utility module (see later). You will be presented with choices for screen colors, prompted for modem port and speed, and asked to select the funds that should be displayed on the selection screen in the future. Please note that you cannot choose more than eight funds from the list (plus the Fidelity Funds that are a compulsory choice). You can add up to three families of funds that are not listed in the program, however you will not be able to avail yourself of any dialing routines when connected to these funds, At each question, the current selection is presented in square brackets (eg. [C:\FUND]). If you do not wish to change it, press the <ENTER> key. You may also add the "Fidelity Brokerage" account at this time (see the specific instructions for the use of this option). 7 NOTE: If you do not have a modem, or do not want to use one, type 0 when asked for the modem's port. If you do use a modem, make sure that it is connected and turned on before starting this program. If you elect to delete all "closed positions" (ie. all lots of shares that have been fully sold), a small error will be introduced into the gain/loss calculations for the individual accounts (read under "Sales log" for more information), and the gain/loss calculations will exclude all the "closed positions". You will be also asked to select a directory path for downloading quotes from Prodigy.CompuServe. If you will not avail yourself of this service, press <ENTER>. Otherwise select any directory path that is convenient (eg. for CompuServe(R) it might be C:\CIM\CABINET\GENERAL, or for Prodigy(R) - C:\PRODIGY). NOTE: Once you selected all the groups of funds to be displayed on the screen and inserted the initial balances on your account (see later under "Adding new accounts"), you are advised to follow the procedure described under "Transactions' Log" in order to clear all the old data. Namely: display "Transactions' Log" on the screen and press DEL key. In registered copies you are also given a choice whether you wish to protect the access to the program and data with your personal password. Please note that the password is case sensitive, ie. "PASSWORD" is not the same as "password", or "PassworD" ! The data files are further protected from intrusion by encoding some of critical information like: number of shares, PIN code and the personal password. NOTE: Make a note of your password, since once this option has been invoked, the program cannot be started without the correct password. If you retained the original copy of the program (without the password invoked), in emergency you may recover the data by copying the former FUNDS.CFG file into your new directory and then starting the program anew. When this procedure is completed, the initial screen will appear showing that it is unregistered shareware version. Press <ENTER> to continue the program. This screen is absent from the registered version of this program. ------------------ Initial Menu ------------------ Using the FundExpert is straightforward. To start the program, make sure you are on the proper drive and in the proper sub-directory. For example, if you installed the program in the directory \FUND on disk drive C:, you would type the following: C: CD \FUND FUNDS 8 Substitute your drive and directory in the above commands. Once you have followed the steps above, the first screen will be displayed. The first selection screen offers a choice of : 1. Mutual funds - this leads into the main part of the program for Mutual Fund transactions 2. Other investments - for recording etc transactions with bonds, shares or bank accounts 3. Yield of bonds - calculates yield to maturity and duration of bonds 4. Optional dialing - a routine that permits setting up your own dialing sequences (for instance: to obtain current balance on your credit card or bank account). 5. Summary of investments - presents the summary of all investments and categorizes them 6. Utilities - leads to several useful maintenance routines 7. Plotting module - for plotting daily price variations 8. End of Job - terminates the program. Throughout the program certain conventions were maintained. a. Whenever there is a question followed by a blinking question mark (?), the answer should be entered, in some instances this may have to be followed by pressing of <ENTER> button b. A question ending in: [Y]/N indicates that pressing only the <ENTER> button is equivalent to the answer contained in the square brackets. Otherwise pressing of either Y or N is sufficient and additional <ENTER> is not required. ------------------------- Program's limitations ------------------------- The program requires IBM compatible computer, type 286 or higher, a Hayes compatible telephone modem and a telephone receiver with Touch-Tone dialing. The operating system should be MS-DOS version 3.1 or above. The program uses Expanded Memory, if such is available. The "shareware version" requires a computer with built-in clock/calendar, the "registered" version does not have this requirement. If the environmental variable TMP or TEMP is set to a directory on a RAM disk - the program will use that directory for its working files. See the DOS manual for explanation of environmental variables and RAM disk. The data files are of "sequential" type. The data files can be accessed with any editing program, but you are advised against making any corrections, or changes, using an outside editor, since you may inadvertently destroy the usefulness of such files. The content of the data files is further protected from unauthorized intrusion by encoding some of the critical numbers. 9 CHAPTER TWO Mutual Funds ______________________________________________________ If you select "Mutual funds", the next screen allows the choice of the desired family of funds. Select one. The next screen will show the currently loaded account information for these funds. Note a brief summary of available commands in the last four rows of the display. A further display of additional "active keys" may be obtained by pressing ALT-H (for Help screen). In addition to all the available mutual funds, there is an additional choice; "Fidelity Brokerage" account (see the specific instruction for the use of this option). The following keys are activated: F1 - dial the telephone number for the desired mutual fund F2 - obtain the price quotations for the listed mutual funds F3 - obtain the share balance information for your accounts F4 - last purchase information for the chosen account F5 - last dividend information for the chosen account F6 - last sale information for the chosen account F7 - price quotations for funds not listed on the screen F8 - copy "accounts screen" to COPY.DAT file in delimited format F9 - proceed to another function (for Vanguard funds only) F10 - terminate the session and hang up the telephone ALT F1 - change configuration file ALT F2 - sort listed accounts ALT F3 - change to "portfolio screen" ALT F4 - change to "accounts screen" ALT F5 - exchange shares between existing accounts or set up a new account ALT F6 - transfer money from your bank to an existing account ALT F7 - print screen ALT F8 - change to "transactions' log" ALT F9 - cancel last transaction ALT F10 - download quotations from Prodigy(R) or Compuserve(R) INSert - add new account DEL - delete listed account ALT H - Help screen, giving the summary of all active keys In addition, the following keys are available for moving the cursor on the screen: DOWN ARROW - moves the cursor down one row UP ARROW - moves cursor up one row RIGHT ARROW - moves cursor to the right LEFT ARROW - moves cursor to the left 10 ------------------------ Adding New Accounts ------------------------ After you have chosen the desired family of funds, you will be presented with the screen summarizing all your accounts in that family. If you desire to add a new account to the list, press INSert key. You will be presented with a list of questions to answer: Fund number, Fund description, your account number, stock symbol (optional - required for automated downloading of share prices), security code (if none required, enter 99), Social Security number (optional, it is required by some Funds), number of shares on the account, the share yield and price (Note: no. of shares, their yield, and price should be entered on a single line, separated by blank spaces). After you answered all the questions, the screen containing the summary of all your accounts will re-appear. --------------------------------- Deleting an existing account --------------------------------- To delete an existing account, move the cursor to the line on which that account is displayed and press DELete key. You will be asked to confirm your choice, and if you press Y than this fund will be deleted. A deletion of an account will cause also the deletion of all recorded transactions on this account in the "Transaction Log", if you so choose (see later). The registered version of this program offers an option to archive the deleted records in a separate file whose format is compatible with most of the popular spreadsheet and database programs. NOTE: You cannot delete ALL the funds on any given screen. ---------------------------------- Sorting of existing accounts ---------------------------------- You may re-arrange your accounts to any desired order by pressing ALT F2. You will be asked which record should be moved, enter its position (eg. A) and press <ENTER>. Next you are asked to which position the record should be moved. Enter the desired new position (eg. B) and press <ENTER>. Repeat the procedure until all accounts have been sorted. --------------------------------------- Connecting with the Host Computer --------------------------------------- Press key F1 to initiate dialing to the host computer. The modem is silenced at this stage and you will not hear the dialing.You are advised to keep your receiver on the hook until the modem signals with a beep that it has stopped dialing. Now lift the phone receiver and listen to the automated response by the host computer. 11 NOTE: Certain telephone sets appear to interfere with the clarity and/or action of the modem and that is the reason for keeping the telephone receiver "on the hook" while the modem is dialing. Once the dialing is completed, you may select your next action. Move the cursor to the line on which the desired account is displayed. When the host computer asks for next action, hang up the telephone receiver and press F2 if you desire share prices and yields for individual funds, or press F3 if you desire to obtain the balance of shares in your accounts, and their net worth. Each time keep your phone receiver on the hook until you hear the beep signifying that the dialing was completed. You may continue these actions repeatedly until you obtain all the desired information for all the funds in a given family. NOTE: The Benham, Merrill Lynch, and Vanguard families of funds allows you to repeat the actions initiated by either F2 or F3 keys, BUT if you wish to switch from eg. "Share prices" (F2) to "Account balance" (F3), you must first indicate your desire by pressing F9. This procedure is not required by the other families of funds. To terminate your connection with the host computer, you should press: F10 key - this hangs up the telephone line and terminates the current fund selection. You are asked: "Continue? - [Y]/N". If you respond N , the initial menu screen appears. If you press Y , you will be presented with the screen showing the selection of available families of funds. ----------------------------------------------- Share prices and yields, number of shares ----------------------------------------------- After you obtained the new prices and yields for shares (by pressing F2), you may wish to update the records. In order to do that, move the cursor to the appropriate location - just to the left of the number that you wish to change, by use of : RIGHT ARROW LEFT ARROW UP ARROW DOWN ARROW keys. 12 You may change the values of : number of shares, yield and their price after moving the cursor to the desired position. After entering the new value, press <ENTER>. Please note that whenever you change the number of shares, the computer interprets it as a purchase/dividend/sale and will make the appropriate record of the transaction. In order to record the correct price of shares that were bought/sold, ALWAYS change the price before changing the number of shares! The updated screen is automatically displayed. Note that the prices and yields of all other funds on the screen that have the same "Fund Number" are also automatically updated. This feature is particularly useful if you have several accounts with the same Fund (eg, regular and IRA ones). You will also find the date of the last record change in the upper, right corner of the screen. NOTE: If you selected to "record/plot price variations" in the configuration menu, each time you change the price of the share - the new price and the date of change will be recorded in the file HISTORY.DAT, which is subsequently used for plotting that data. You can also receive price quotations for funds not listed on the screen by pressing F7 and providing the fund number (eg 21) when asked for it. Pressing the key F8 copies the data from the screen to COPY.DAT file in delimited format. NOTE : Fidelity family of funds requires that you have at least one account active before you can access the data by phone. ----------------------------------------- Account balance and recent activity ----------------------------------------- The account balance and the current value can be obtained by pressing F3 and following the instructions given in the previous section. Once you go through that procedure, you can also obtain additional information for that particular account by pressing the appropriate keys: F4 - gives the last purchase F5 - gives most recent dividend F6 - gives the last sale ------------------------------------------------ Transfer of shares between active accounts ------------------------------------------------ Several families of funds permit the use of this service for exchange of shares between your active accounts and/or setting up of a new account. However, you must use the individual account numbers rather than the "family" ones. For instance in Fidelity group of funds you are not allowed to use numbers starting with letter "T". Unfortunately, the author was unable to obtain the detailed instructions for this procedure for all families of funds at the time of setting up this program. 13 In order to start this procedure, press ALT F5 and answer the questions as they appear in the top three lines on the screen. You must await response from the Host computer, when it is so indicated on the screen. At the end of the procedure the Host computer gives you the final choice of either accepting or cancelling the transaction as spelled on the screen and spoken by the Host computer on the telephone. NOTE: Whenever you are asked to provide "account (rec. no)", respond with the letter (eg. A) corresponding to that fund. If you wish to open a new account, you must provide the Fund No. as specified by the prospectus. After each selection/response press <ENTER> key. ----------------------------------- Transfer of funds from a bank ----------------------------------- In order to use this service, special arrangements must be made with your Fund Manager (as eg setting up of "Money Line" for Fidelity funds). You must use the individual account numbers rather than the "family" ones. In order to start this procedure press ALT F6 and answer the questions as they appear in the top three lines on the screen. At the end of the procedure the Host computer gives you the final choice of either accepting or cancelling the transaction as displayed on the screen and spoken by the Host computer on the telephone. NOTE: Whenever asked to provide "account (rec. no)", respond with the letter (eg. A) corresponding to that fund. --------------------- Gain/Loss screen --------------------- As you change a listing of all the accounts with a given Fund and/or change the amount of shares that you own in these accounts, an additional information is being developed in the supplementary screen - called "Gain/Loss screen". You can access this screen by pressing ALT F3 keys. The screen presents the Fund number, account name, the amount of money that you invested (ie. all the purchases, less all the sales), the current value, the total profit/loss, and average percentage of gain/loss over the period from the date shown on the screen. 14 The average percentage gained/lost on investment ("av. %") during the period, starting on the date shown, is simply the total capital gains (re-invested dividends plus change in shares' price) divided by the total amount invested during that period. Note that any distributions (such as dividends) that were not re-invested, are not included in the gain/loss calculations. You are permitted to change the date, and this will cause all the PERCENT gain/loss calculation to commence from that date only, but the "Profit/Loss" will continue to be computed on all available records. However the new date MUST BE IDENTICAL with one of the actual transaction dates on that account. You can determine the acceptable dates by reviewing the data in the SHARE.LOG file (you van view it by pressing ALT-F8 keys). Note that in the calculation of the average percentage gained/lost on investment ("av. %"), all shares purchased prior to that date are automatically re-priced to the price recorded on that date and thus the result of these calculations is greatly influenced by the selection of the correct date. The annualized gain/loss (ann. %) is the quarterly compounded, annual interest rate, that would produce the same average percentage gain/loss during the period, as the one calculated above, if a lump sum was invested at the beginning of the period at the "ann. % " rate. The Total Gain/Loss and Average % Change for the particular family of Funds are presented in the top right-hand corner of the screen. The Total Gain/Loss is the amount compiled from ALL the records available in SHARE.LOG file, while the Average % Change is the average for all transactions that occurred AFTER the date shown in the table. You can change back to the account screen by pressing ALT F4 keys. ----------------------- Transactions' log ----------------------- A log of all the transactions. ie. any change in the number of shares, is maintained separately and can be accessed by pressing ALT F8 keys. The last column that is displayed, "amount paid ($)", represents the amount paid for the purchase (if positive), or amount received from sale (if negative), or will be equal to 0 if the transaction was a result of dividend distribution. If desired, you can print that log by pressing ALT F7 keys while the log is displayed on the screen. No changes can be made to these records. However you may delete the records by pressing DEL key. You are then given an option to delete either all the transactions, or to delete only the "closed" transactions in the Money Market funds. When the option to delete ALL the transactions is activated, the dates on the Gain/Loss screen are also changed and all the calculated percentage profit will be calculated for the period starting from the date when the change was initiated. The deleted transactions may be saved in a file SHARE.ARC using "de- limited" format, and accessed by most spreadsheet (eg. Lotus 123(R)) or data-base (eg. dBase(R)) programs. 15 --------------- Printing --------------- You can obtain a printed copy of any screen, by first placing the desired table on the screen (press ALT F3 - for Gain/Loss screen, ALT F4 - for Account screen, and ALT F8 - for Transactions log), and then pressing ALT F7 keys. ------------------------ Fidelity Brokerage ------------------------ Although this option has been placed under the "Mutual Funds", none of the F keys is activated. The program will permit you to interact with the host computer for placing the buy/sell orders and obtaining stock quotations. Simply follow the instructions as they appear on the screen and listen to the responses through the telephone receiver. The dialing sequence has been timed to correspond to the various questions asked by the host computer, at one point you have a choice of two responses, depending on the question asked by the computer. Since the sequence is rather complicated, you should first try it out with the modem disconnected from the telephone line. 16 ------------------------------------------------------ Downloading quotations from Prodigy or CompuServe ------------------------------------------------------ NOTE: You can download ONLY the price quotations for the securities already listed in one of the existing accounts and displayed on the appropriate "account screen". The stock symbol of such securities MUST be identical in all respects to the symbol used by the source of the data (Prodigy(R), or CompuServe(R) ). Please note that the two services use somewhat different symbols for certain securities (eg. bonds). 1. DOWNLOADING FROM PRODIGY(R) You may update the prices by down-loading the quotations from the Prodigy(R) Service using the following procedure: 1. On the Prodigy(R) Service list your stocks on either Quote Track 1 or 2 (however your list does not have to be restricted to the shares listed in the FundExpert program). 2. On Prodigy(R), select "Files" menu, then select "Report setup" and choose the following: Range: Entire list Report type: Closing prices Destination: Files On the next screen select: Text (*.TXT) No column headings File: [path] QUOTE.TXT (Path is the directory that you selected during the SETUP) On the next screen select: OVERWRITE FILE 3. Save the setting "for all future sessions" and "print". When the printing is completed, return to FundExpert program, go to the screen of interest (eg. stocks, or a particular family of Mutual Funds) and press ALT-F10. All the prices on the screen will be updated automatically. 2. DOWNLOADING FROM COMPUSERVE(R) You can download the quotations from CompuServe(R) using their CIM (Compuserve Information Manager) interface. 1. Start CIM in the usual way and select "Quotes..." from the Service Menu. Using CIM published procedure, select the list of stocks that you desire to download and press "ALL" 17 2. Once you receive the response and listing of all the quotes, SAVE the data in a file named "QUOTE.TXT" and located in the directory that you selected during the SETUP (eg. C:\CIM\CABINET\GENERAL) 3. Return to the FundExpert, proceed to the screen of interest (eg. stocks, or a particular family of Mutual Funds) and press ALT-F10. 18 CHAPTER THREE Stock Market ______________________________________________________________ IF you select "Stock Market" from the initial selection screen, you enter a separate routine for all your stock market transactions. In most respects the screen display and operation resemble the corresponding features of the section dealing with the Mutual Funds. The following differences should be noted however: 1. Only the following keys are active in this routine: F10, ALT F3, ALT F4, ALT F9, ALT F10, INS, DEL DOWN ARROW, UP ARROW, LEFT ARROW, RIGHT ARROW and their actions are the same as in the Mutual Fund section of this program. 2. The dividends and other distributions that are not re-invested, are not included in the gain/loss calculations. 3. The sales log for the stock market transactions is maintained in the identical way to that described in the "Mutual Fund" section of this manual. However the sales log can be accessed only through the "mutual fund" section, or the "Utilities" section of the program. 4. You can change the number of shares, their yield and price by simply moving the cursor to the desired position (using the arrow keys) and typing the new value. 5. A deletion of any share record from the Account Screen, may also delete all related transactions from the Transaction Log, if you so select. 19 CHAPTER FOUR Bond portfolio ______________________________________________________________ IF you select "Bond portfolio" from the initial selection screen, you enter a separate routine for all your bond transactions. In most respects the screen display and operation resemble the corresponding features of the section dealing with the Mutual Funds. The following differences should be noted however: 1. Only the following keys are active in this routine: F10, ALT F3, ALT F4, ALT F9, ALT F10, INS, DEL DOWN ARROW, UP ARROW, LEFT ARROW, RIGHT ARROW and their actions are the same as in the Mutual Fund section of this program. 2. The dividends and other distributions that are not re-invested, are not included in the gain/loss calculations. 3. The sales log for the bond transactions is maintained in the identical way to that described in the "Mutual Fund" section of this manual. However the sales log can be accessed only through the "mutual fund" section, or "Utilities" section of the program. 4. A deletion of any share record from the Account Screen, may also delete all related transactions from the Transaction Log, if you so select. An additional screen of data "Bond calculations and Payment dates" can be reached by pressing ALT F3 keys. The following additional information is provided on this screen: 1. Actual yield to maturity of the bond, calculated using S&P formula using two basis: (a) "orig" - assuming that the bond was purchased on date shown, and (b) "today" - assuming that the bond was purchased today. The second alternative is useful in evaluating the change in the bond's yield as its market value changes. 2. Payment dates and the amount paid. For your convenience, any payments that are due within the next 30 days, and 10 days after the pay date, are highlighted. 20 CHAPTER FIVE Bank Accounts _________________________________________________________________ IF you select "Bank accounts" from the initial selection screen, you enter a separate routine for all your bank transactions. In most respects the screen display and operation resemble the corresponding features of the section dealing with the Mutual Funds. The following differences should be noted however: 1. Only the following keys are active in this routine: F10, ALT F9, INS, DEL DOWN ARROW, UP ARROW, LEFT ARROW, RIGHT ARROW and their actions are the same as in the Mutual Fund section of this program. 2. The sales log for the bank transactions is maintained in the identical way to that described in the "Mutual Fund" section of this manual. However the sales log can be accessed only through the "mutual fund" section of the program. 3. You can change the number of shares, and their yield by simply moving the cursor to the desired position (using the arrow keys) and typing the new value. The price of shares is assumed to be $1 each. 4. A deletion of any share record from the Account Screen, may also delete all related transactions from the Transaction Log, if you so select. It is suggested that you use following descriptive titles: CD - Certificates of Deposit MM - Money Market accounts SAV - Saving accounts REG - Other checking accounts 21 CHAPTER SIX Other features ____________________________________________________________ -------------------------------- Customized Dialing Routine -------------------------------- The user is given an opportunity to design up to five customized dialing routines. In order to do so, select "optional dialing" from the selection screen and you will be given the next choice of: dialing, setup, and correction. Select "setup" and follow the instructions on the screen to enter the telephone number and the dialing sequence. You may use numbers in any combination with the following symbols: ( - ) . In addition, you may use a comma whenever you wish to introduce a pause in dialing. Each comma is equivalent to a pause of 2 seconds. Press <ENTER> when finished. You may alter/correct your dialing sequence by choosing "correction" from the menu. You will then be presented with the current sequence and you can type the corrected sequence immediately underneath the old one. Press <ENTER> when the corrections are completed. -------------------- Yield of bonds -------------------- A separate routine (available from the initial selection screen) is provided for calculating yield to maturity and duration of bonds. The yield to maturity is calculated by three different methods. The first two: 1. Moody's equation and 2. S&P equation have been published by these two, well known companies. However they implicitly assume that the annual premiums are re-invested at the interest rate of the bond. This is not necessarily true. For instance you may purchase a bond having a nominal interest rate of 9%, but be able to reinvest the proceedings at only 4%. In the third calculation there is no such assumption. You select the interest rate that you expect to obtain on invested annual premiums, and the computer calculates what would be the equivalent, annualized, compounded interest rate if the funds were held to bond's maturity. The Moody's equation requires a number of iterations and you may find some delay before the results are printed (particularly with slower computers and/or bonds of long time to maturity). The delay time may be controlled by selecting the default (fast), or "more precise" (slower) iteration interval at the opening screen for the procedure. 22 The duration of bonds is also calculated, since this provides a measure of sensitivity of the bond to interest fluctuations. In the last column, the projected change in the value of the bond is calculated for 1% change in the interest rates prevailing in the marketplace. ----------------------------- Summary of investments ----------------------------- If you choose from the initial menu "Summary of investments", you will obtain a summary of all your investments in the mutual funds (sub-divided into: stock funds, bond funds and money market funds), as well as your bond, stocks, and bank accounts . The summary will be presented both as the dollar value and percentage of total capital. The total value of dividends per year from the bonds is also given, as well as the amount of dividends due before the end of the present calendar year. If in the program configuration you selected to record/plot the price variations - the program will also calculate the total capital gains in the Stock and Bond Mutual Funds since the beginning of the current year. (NOTE: You are advised to price ALL the mutual funds on January 1st, as the program searches for the prices dated nearest to that date and uses them for the calculation of the total value of bond and stock funds at the beginning of the current year.) ----------------------- Utility programs ----------------------- 1. "Pre-dated entries" Normally the new entries are acquiring the current date automatically. However, on occasions it may be desired to use a different date, eg pre-date for transactions that have occurred before installation of this program. This can be accomplished by selecting the "Pre-dated entries" from the "Utilities" menu and replying to the questions as they appear on the screen. 2. Delete records from SHARE.LOG This routine allows to delete: (a) all records, (b) all transactions in Money Market funds and "dividents", The divident payments are combined prior to a selected date, and that date is automatically recorded on the "Gain/Loss" screen. All future calculations of gain/loss will start from that date. These techniques are useful for reducing the size of the SHARE.LOG file, which is limited to 200 records. 23 3. View files This routine displays the content of the COPY.DAT and SHARE.ARC files. Both of these files are written in delimited format, suitable for subsequent use in a variety of spreadsheet (eg. Lotus 123(R)), or data-base (eg. (dBase(R)) programs. 4. Delete files A routine for deletion of optional files, such as: SALES.LOG, SHARE.ARC, COPY.DAT, and QTRACK.TXT. 5. Capital gains calculation IRS Schedule D (capital gains) requires a report of "purchase date and cost/base" and "sales date and gross sale price". Frequently your sale lots may differ in the number of shares from the purchase lots. Three different reporting methods are approved by IRS: 1. First In, First Out (FIFO) method 2. Specific identification method 3. Category averaging method This part of the program will provide the required information for all three method. However you are advised to consult the IRS regulations on use of these techniques. (a) A common method for reporting such sales is known as FIFO (ie. "First in, first out"). The program does these calculations for you and you can obtain the report by selecting "Sales log" from the selection screen. The "sales log" does not include any Money Market Fund transactions. The program gives you an option either to list ALL the transactions, or only those lots that were sold between a selected "starting date" and "final date". NOTE: the "Date bought" and "Date sold" are highlighted for all "long term sales" (ie. when the assets were held for more than 360 days). The report will be printed out, if you press ALT F7 keys. If you made the appropriate selection in the configuration section of this program, you may also delete all the "closed" positions (ie. all lots of shares that have been sold). However you are advised that selection of this option may introduce small errors in calculation of gain/loss in all the accounts. (b) Specific identification method allows you to identify the particular lot that you are selling and the program will record your selection for future use. After you select the particular security that you wish to sell, the program displays a listing of all the available transactions. The list includes the date of the transaction, number of shares purchased, number of remaining shares and their purchase (base) price. The number of remaining shares represents the number of shares that has not been sold in any of the previously recorded transactions. 24 (c) Category averaging method permits you to use as the basis the average price of all identical securities that were bought at different times. The program will calculate these averages for you. You may select either "single category" or "double category". The "double category averaging" method gives the average for securities held for less than one year, and those held for more then one year. 6. Reconditioning of files In the unlikely event that the data files become corrupted and the program indicates an error, this procedure is provided in the REGISTERED copies only. It will recondition all the data files (without the loss of data) and thus clear the error. -------------------- Plotting module -------------------- All changes in prices of mutual funds, shares, and bonds are automatically recorded in the file HISTORY.DAT if you opted this option in the configuration routine. You may plot this data by entering the "Plot module" and selecting the particular group of data by answering a few questions on the display screen. The data is plotted as price (on the Y-axis) versus the number of days (on the X-axis) since the first entry. If a share distribution has occurred (as capital gains, or stock split) you may correct all the previous (recorded) quotations by selecting the routine from the menu and entering the number of shares that have been distributed per one share owned. You should perform this procedure only once for each share distribution, since all the records are permanently corrected. A list of the historical data may also be recorded to widen the period covered by the plot, however only the securities listed in any one of the accounts (and displayed on the "account screen") can be entered. As an additional feature in this program you may add a plot of a "moving average" to aid in your investment decisions. A "moving average" is a plot of an average taken over the previous n weeks, where you can select the value of n, versus the number of days and it tends to eliminate any minor variations in prices. For a longer term predictions it is preferred to use a 30-week average, but that can only be done with a data base stretching for at least 1 year. If you select 1 week, the plot will almost coincide with the actual data points. A good compromise is to take an intermediate value of 10 weeks. NOTE: For successful creation of a plot of "moving average" it is necessary to record the price variations at constant time intervals: daily, or weekly. For an average investor it is suggested that weekly routine is satisfactory. 25 LICENSE AGREEMENT ------------------------------------------------ The use of the FundExpert program is granted under the following terms: 1) You may make copies of the program and documentation in their original, unmodified, form without restriction. You may make copies of the documentation either in its printed or machine readable form without restriction. If these copies are distributed to others outside of your organization, you have no obligation to control the use of those copies; however, any copies made which are distributed within your organization are restricted to the terms of this license agreement. 2) You may not modify the program or its documentation or charge a fee for copying or distributing the program or its documentation. 3) You may use the FundExpert program on the number of computers for which you have paid the license fee. If the fee has been paid for a site license, you may use the program on as many computers as are located at that site; however, you may not use the program on any computer not located at that site without paying an additional licensing fee. I agree to abide by the terms and conditions of this license. ______________________________ _____________________ Signature Date 26 REGISTRATION INFORMATION FundExpert Version 2.4 Name: ________________________________________________ Company: _____________________________________________ Address: _____________________________________________ _____________________________________________ City: ______________________ State: ______ ZIP: ___________ License fee for ____ computers at $40.00 per computer ________ OR Site license, unlimited use at one site ($100.00) ________ Total ________ Indicate required disk type: 5 1/4 inch or 3 1/2 inch (5 1/4 inch is preferred) Make check payable to George R. Cotten and mail to: 37 Lawrence Lane, LEXINGTON, MA 02173. 27 LIMITED WARRANTY _______________________________________________________________ The author warrants to any licensee that acquires the program from him that: 1) All diskettes the author provides to licensee constitute an accurate duplication of the software and manual. The author will replace any diskette found to be defective within 30 days from the date of acquisition. The author withholds the right to not honor this warranty if the diskette has been subjected to physical abuse, or used in defective or incompatible equipment. 2) The FundExpert program will perform substantially as described in the documentation accompanying the software, if used as directed in such documentation. 3) This warranty specifically limits any remedy to the replacement of the physical diskette and documentation if these were originally acquired directly from the author. It shall not cover any other damages including, but not limited to: loss of profit, commercial damage, or other special, consequential or similar claims. The FundExpert program is sold without warranty as to its merchantability or fitness for any particular purpose. 4) The author makes no warranty that its software is error free nor that its use by the licensee will be uninterrupted. 5) It is necessary to complete and return the registration card and pay the license fee to implement this warranty and to receive customer support.