Software Vault: The Gold Collection/Software Vault - The Gold Collection (American Databankers) (1993).ISO/cdr02/pfroix.zip/PFROI3.DOC

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87 PFROI User Manual - Copyright (C) 1985-1991, Techserve, Inc.





7 PFROI - Special Situations
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Individual Retirement Arrangements (IRA's)
───────────────────────────────────────────────────────────
Because of their special tax treatment, IRA's and other tax-
protected retirement accounts should generally be kept in a
portfolio file separate from investments subject to normal
taxes.

In general, the first tax rate record in an IRA or tax-free
retirement portfolio should be dated the account opening
date, and should have a tax rate of zero.  The holding
period, capital gains rate and loss limit records should
contain entries, preferably rates in effect at the date of
the record.  Subsequent tax rate records are not needed as
long as income within the account is tax-free:

  Mo/Dy/Yr T Hold Prd CG Rate Max Loss Tax Rate Lng/Sht Loc Rate Index
  == == == = ======== ======= ======== ======== ======= ======== ======
  02/14/82       6.00   0.500     3000    0.000   0.500    0.000 1.0000
    /  /

Contributions to IRA's and other retirement accounts are
classified as "deductible" or "non-deductible" for deter-
mining taxability upon ultimate withdrawal of funds from the
account. "Deductible" funds are earnings on which you have
not yet paid taxes because the I.R.S. has allowed them to be
deducted from reportable gross earnings (e.g. the $2000/year
allowed for those below the IRA maximum earnings "cutoff").

"Non-deductible" funds are those on which the I.R.S. requires
you to pay taxes but which they've allowed you to contribute to
the retirement account so that earnings thereon may accumulate
tax-free.

Generally, you should segregate "deductible" and "non-deduc-
tible" contributions in your retirement portfolio.  This may
be accomplished by assigning a unique symbol to "non-deduct-
ible" deposit transactions.  For example, you contributed
$2000 to your IRA in 1988, but because of your tax bracket
the I.R.S. only allows you to deduct half of this amount from
your gross earnings.  Your IRA account transactions would
appear as follows:

  Mo/Dy/Yr TAC Symbol Lot   Description     Quantity     Amount    Est. Tax
  == == == === ====== === =============== =========== ============ ========
   1/02/88 DPF            Deductible contr.                1000.00
   1/02/88 DPF XXXXXX     Non-ded. contrib.                1000.00
   1/02/88 BUY MMF$       Money Mkt Fund         2000     -2000.00

88
IRA investors may optionally place the notation "=C-" in the
description field of "BUY", "BYD" or reinvestment trans-
actions (DRI, IRI, SGR, CGR) so as to suppress cumulation of
cost bases. The reasoning for this is that tax-deductible
contributions have a zero cost basis from a tax standpoint.
On the other hand, some users may wish to retain cost bases
for better visibility of investment gains and losses.
Neither treatment will affect estimated taxes since tax rates
are set to zero.

Upon retirement, tax-deductible contributions and tax-free
earnings within the account are taxed at the investor's tax
rate as the funds are withdrawn from the retirement account.
The estimated tax liability should be entered in the "Est.
Tax" field of such withdrawal transactions.

Withdrawal of non-deductible account contributions (funds on
which you paid taxes before contributing to the retirement
account) are not taxable and thus are treated as a normal
withdraw-funds transaction.  We suggest that you enter such
withdrawals with a unique ticker symbol so they may be
isolated with the "Mask" command and reconciled with the
initial deposit transactions.

For example, you are past age 59 1/2 (the minimum IRA with-
drawal age) and you make a quarterly withdrawal of $4000 from
your IRA, comprised of $225 of non-deductible contributions
with the remainder from deductible contri-butions and tax-
free earnings.  Your marginal tax rate is 28%.  The trans-
actions would appear as follows:

  Mo/Dy/Yr TAC Symbol Lot   Description     Quantity     Amount    Est. Tax
  == == == === ====== === =============== =========== ============ ========
   4/01/91 SLL MMF$       for MMF withdraw      -4000      4000.00
   4/01/91 WDF            Taxable IRA dist.               -3775.00     1057 m
   4/01/91 WDF XXXXXX     Non taxable IRA dist.            -225.00

Since WDF transactions normally do not take symbols or
estimated taxes, you will have to manuver the cursor into
these fields vertically from a transaction that does accept
these fields.

If funds are prematurely withdrawn from the account, manual
"estimated tax" entrys should be made to cover estimated
taxes plus early withdrawal penalty.


Mutual Funds
───────────────────────────────────────────────────────────
PFROI "reinvestment" transactions DRI, IRI, CGR and SGR simp-
lify handling of mutual funds which otherwise may be treated
like any stock.

The BYD and SLW transactions may be used for fund deposits
and withdrawals, assuming the funds are deposited/withdrawn
from the portfolio on the same date that shares in the fund
are bought or sold.

89
For simplicity, mutual fund tax treatment should generally be
"first in, first out" (FIFO) or "running average cost" (see
Tax Lot Numbers Chapter 6).

PFROI's "running average cost" calculation implements the
"Average Cost - Single Category" method allowed by the I.R.S.
for mutual funds.  This method will generally result in lower
taxes than FIFO in a rising market but higher taxes in a
falling market. Once you select a tax lot method, you must
continue to use that method until you have closed out your
position in that fund.

Many mutual funds levy an annual fee by reducing the number
of shares to your credit.  A SLL transaction followed by a
negative FEE transaction of the same amount should be use to
enter reduction in shares to cover fund charges:

  Mo/Dy/Yr TAC Symbol Lot  Description     Quantity     Amount    Est. Tax
  == == == === ====== === =============== =========== ============ ========
  01/02/90 SLL MUTFND     Mutual Fund @10        -2.5        25.00
  01/02/90 FEE MUTFND     Annual Fee $25                    -25.00

The "FUI" (Fee-UnInvest) transaction combines the "FEE" and
"SLL" into a single transaction which may be alternatively
used as follows:

  Mo/Dy/Yr TAC Symbol Lot   Description     Quantity     Amount    Est. Tax
  == == == === ====== === =============== =========== ============ ========
  01/02/90 FUI MUTFND     Mutual Fund @10        -2.5       -25.00

Undistributed capital gains declared by mutual fund com-
panies require the shareholder to pay tax on the undistri-
buted gain and adjust their cost basis upward.  This may be
accomplished by using the CGR (Capital Gains Reinvestment)
transaction with a zero share quantity:

  Mo/Dy/Yr TAC Symbol Lot  Description     Quantity     Amount    Est. Tax
  == == == === ====== === =============== =========== ============ ========
  12/31/89 CGR MUTFND     Undistr. Cap Gain         0       215.29


Stock Options (Puts and Calls)
───────────────────────────────────────────────────────────
Purchases and sales of put and call options may be treated
in a similar manner as the purchase and sale of stock.


Puts

A "Put" is an option to sell a stock at a fixed price over a
set period.

A "buy" (BUY) transaction is used when a Put is bought.  The
number of options and the transaction cost are placed in the
Quantity and Amount fields. For example, you buy a Put on
90
1000 shares Ford Motor at 50, expiration March for a price
of 1 1/2 and a $35 commission:

  Mo/Dy/Yr TAC Symbol Lot    Description      Quantity     Amount    Est. Tax
  == == == === ====== === ================== =========== ============ ========
   1/ 4/89 BUY F+       1 Ford @1.5/50 xc Mar       1000     -1535.00

Note that rather than using "10" to indicate ten blocks of
100 as per option trading convention, the quantity entry of
"1000" was used, This is done to ensure that quoted price
($1.50) times quantity will equal the total value of the
option holding.

A "sell" (SLL) transaction is entered whenever a Put held
long is sold or expires.  The "Amount" of this transaction
is the sales proceeds if the Put is sold, or zero if the Put
expired. For example, suppose in the prior example the price
of Ford stays above 50 and thus the Put expires worthless:

  Mo/Dy/Yr TAC Symbol Lot    Description      Quantity     Amount    Est. Tax
  == == == === ====== === ================== =========== ============ ========
   3/30/89 SLL F+       1 Ford @1.5/50 expired     -1000         0.00

If a Put is exercised, the cost of the put should be
deducted from the sale price of the stock sold using the
Put.  The original Put "buy" transaction should then be
modified by zeroing the Quantity and Amount entries.  For
future reference, it is also a good idea to place a note in
the Description field that the Put was exercised.  An
example of the purchase and exercise of a Put is as follows:

  Mo/Dy/Yr TAC Symbol Lot    Description      Quantity     Amount    Est. Tax
  == == == === ====== === ================== =========== ============ ========
   2/ 3/88 BUY XYZ+     1 200 @ 2.25 xc 5/26           0        -0.00
   5/26/88 SLL XYZ      2 XYZ with 2/3/83 put       -200      7475.00


Calls

A "Call" is an option to buy a stock at a fixed price over a
set period.

A "buy" transaction should be used when a Call is purchased
"long"; a "sell" transaction should be used when it then is
sold or expires.  An example of a Call purchase, followed by
expiration is as follows:

  Mo/Dy/Yr TAC Symbol Lot    Description      Quantity     Amount    Est. Tax
  == == == === ====== === ================== =========== ============ ========
   4/21/88 BUY XYZ-     1 200 @ 1.75 xp 6/30         200      -375.00
   6/30/88 SLL XYZ-     1 XYZ Call expires          -200         0.00

If a Call is exercised, the cost of the Call should be added
to the cost of the stock bought using the Call.  The
Quantity and Amount entries should then be zeroed in the
original Call transaction, with a notation added in the
security field that the Call was exercised.

91
"Writing" a Call option is a "Short Sale" transaction
regardless of whether you hold the underlying security. Such
sales thus require the SLS transaction code. If the Call
expires or is excercised by the buyer, a covering BYC TAC
should be used with an amount of zero.

If a Call you've written reaches the strike price and the
buyer of the Call exercises his right to buy at the
specified price, then you must also sell off the underlying
security. If you already hold the security ("Covered Call")
this would be a SLL TAC, else it is a SLS TAC to be followed
by a later covering purchase of the underlying security
using BYC.   The sale and subsequent exercise of a "covered"
Call would appear as follows:

  Mo/Dy/Yr TAC Symbol Lot Description           Quantity    Amount    Est. Tax
  == == == === ====== === ===================== ========== =========== =========
  01/02/89 BUY XYZ      1 XYZ corp.                   1000   -50000.00
  03/01/89 SLS XYZ-     1 XYZ call, @55 May exp.     -1000     2500.00
  04/21/89 BYC XYZ-     1 XYZ call exercised          1000        0.00
  04/21/89 SLL XYZ      1 XYZ corp. to fufill call   -1000    55000.00

Note in the above examples that a "+" sign is used with the
stock symbol to indicate a "Put" transaction while a "-"
sign is used to indicate a "Call" transaction.  This is a
convenient way to differentiate the option symbol from the
symbol of the underlying stock.

Since the U.S. tax rules for options differ somewhat from
other securities you should check with your tax advisor to
be sure you are properly reporting these transactions to the
I.R.S. You may also need to make separate entries in the
portfolio tax tables to reflect differing tax treatment for
Puts and Calls as compared to other securities.



Employee Stock Options
────────────────────────────────────────────────────────────
Employee stock options should be entered into the portfolio
file only when the options are exercised and converted to
stock.  A normal "buy" transaction is then used.  The
exercise of employee options may incur additional taxes
under the "Alternative Minimum Tax" provisions of the U.S.
tax laws and may be subject to a special holding period for
long term capital gains.  Use a "TAX" transaction code or a
manual "Est. Tax" entry to make appropriate adjustments if
either of these circumstances apply.


Gifts/Inheritance
────────────────────────────────────────────────────────────
Property received as a gift or inheritance is subject to
special U.S. tax rules with regard to determining cost basis
and holding period.  PFROI's automatic "estimated tax"
calculation may not accurately reflect these rules in all
regards. The user should review and understand these tax
rules or consult their tax advisor before relying upon
PFROI's results.

92
The following procedure is valid, however, for most cases:

 a) Enter a "receive" (RCV) transaction using the market
    value of the property in the "Amount" field:

    1) Inherited Property - Use the day after the decedent's
       death as the transaction date.

    2) Gift Property - Use the date the property was
       acquired by the donor, unless the market value upon
       receipt was less than the donor's cost basis.  In
       this case use the day after the date of receipt as
       the transaction date.

 b) Enter a "SLL" transaction upon sale of the property.
    Review the tax rules for special provisions which might
    affect your situation, necessitating a manual tax entry.


Wash and Short Sale Tax Rules
────────────────────────────────────────────────────────────
The U.S. federal tax code contains "wash sale" and "short
sale" rules which prevent an investor from realizing loss
deductions or long-term capital gain benefits through use of
"wash" sales or certain "short" sales.  A summary of the
rules and the proper treatment with PFROI are as follows:

 1) Wash Sale Rule - You are a private investor and you
    purchase or buy an option to purchase a security within
    a period extending from 30 days before to 30 days after
    the sale of a substantially identical security.  The
    rule disallows deduction of any loss on the original
    "sell" transaction.

    Include the notation "=C-" in the description field of
    both the "buy" and "sell" side of the wash transactions
    to suppress cost basis accumulation. Also, manually
    enter "0" in the estimated tax field of the sell
    transaction to suppress capital gains reporting on the
    sale.

 2) Short Sale Rule - You sell a security short while
    holding a "substantially identical security" short-term
    or you acquire a "substantially identical security"
    before covering the short sale.  The rule dictates that
    any gain on the short sale is short-term and that the
    holding period is suspended on any "substantially
    identical security" held during the short transaction.

    The net effect of the short sale rule is that short-
    sell/cover transactions are considered short-term unless
    the covering shares were already held long-term at the
    time of the short sale.  PFROI's autotax treats all
    short sell/cover transactions as short-term.  A manual
    tax entry must be used if your short sale qualifies for
    long-term treatment.


93
Exchanges of Securities (Mergers/Divestitures/Spin-Offs)
────────────────────────────────────────────────────────────
Many corporate mergers are implemented through the exchange
of securities issued by the buying company for the securi-
ties of the purchased company.

Occasionally a company will also exchange one class of
security for another security or will distribute new
securities in a divested subsidiary. These transactions may
or may not be tax-free, depending on the circumstances.

If an exchange is taxable (generally the case), it is
implemented in the portfolio by entering a "sell" trans-
action to close out the old security position.  This is
followed by a "buy" transaction on the same date to open the
new security position.  Typically the "Amount" of both the
"sell" and "buy" transaction will be identical at the
transaction's stated price:

  Mo/Dy/Yr TAC Symbol Lot  Description     Quantity     Amount    Est. Tax
  == == == === ====== === =============== =========== ============ ========
   1/15/80 BUY XYZ      1 XYZ Corp.               100     -2000.00
      :
   5/22/87 SLL XYZ      1 XYZ bot by ABC         -100      2750.00
   5/22/87 BUY ABC      1 ABC for XYZ             220     -2750.00

If an exchange is tax-free (infrequent, usually involves
recapitalization), the portfolio entries are a little more
complex. The old position is closed out with a DLV trans-
action on the date of the exchange with a zero manual tax
entry. The new security position is opened by entering a RCV
transaction and using the description field to specify the
original acquisition date and cost base.  This approach
maintains a correct cash valuation and also ensures the
correct cost base and holding period on capital gains
reports:

  Mo/Dy/Yr TAC Symbol Lot    Description     Quantity      Amount    Est. Tax
  == == == === ====== === ================= =========== ============ ========
  2/12/78 BUY XYZ       1 XYZ Co. (orig buy)        200    -10000.00
  3/14/88 DLV XYZ       1 XYZ Co.                  -200     -3500.00        0m
  3/14/88 RCV RXYZ      1 RXYZ &&2/12/78 $10000     100      3500.00        0m

Security distributions in divestitures or "spin-offs" are
generally treated similarly to tax-free exchanges.  The only
difference is that multiple securities are received instead
of the single security shown in the prior example.

To obtain both the correct cost basis and ROI for the parent
stock in a "spin-off" type divestiture, both a "DLV" and
"CBA" type transaction are required.  The "DLV" transaction
should have zero quantity since the number of shares owned of
the parent stock will not be reduced.  The "Amount" of the
"DLV" transaction should be the amount by which the market
value of the parent stock is reduced due to the spin-off.
The "CBA" transaction is used to reduce the cost basis of the
parent stock. In the following example, "X" is bought on
1/2/90 and doubles in value by 1/2/91 at which point 100
shares of "Y", worth $6000 on 1/2/91 are spun off.  This
94
reduces the market value of "X" by $6000 and the cost basis
by $3000:

Mo/Dy/Yr TAC Symbol    Lot    Description     Quantity     $ Amount   Est Taxes
== == == === ========= === ================= =========== ============ =========
01/02/90 BYD X        -                             1000    -10000.00
01/02/91 DLV X        -                                0     -6000.00
01/02/91 CBA X        -                                      -3000.00
01/02/91 RCV Y        -    &&1/1/90 $3000            100      6000.00


Money Market Funds
───────────────────────────────────────────────────────────
Although a money market fund is often used like a bank
account, per the I.R.S. it is technically a mutual fund
requiring share accounting treatment.  BUY, SLL, (or BYD &
SLW) and DRI transactions may be used to achieve this as
follows:

  Mo/Dy/Yr TAC Symbol Lot   Description     Quantity     Amount    Est. Tax
  == == == === ====== === =============== =========== ============ ========
   1/05/87 BYD MMF$       Dep/Buy mmf shrs   20000.00    -20000.00
   2/02/87 DRI MMF$       mmf div reinvest     113.25       113.25
   3/02/87 SLL MMF$       sell mmf shares    -2000.00      2000.00        0m
   3/02/87 WDF            withdraw funds                  -2000.00

When you perform valuations, the money market shares are of
course valued at $1/share.  Embedding the currency symbol
(e.g. "$") in the symbol enables PFROI to recognize this and
thus speed cost basis computations.  Note that since the
money fund doesn't have capital gains, you may omit use of
the tax lot number without concern for transaction matching.
A manual tax entry of "0" however should be made for money
market "SLL" transactions to keep them off the capital gains
reports.

An alternative to using share accounting for your money
market fund is to use cash accounting.  This merely involves
depositing funds to the portfolio without "buying" any money
market fund shares.  PFROI then treats these funds as a part
of the "cash" in your portfolio. When "interest" is paid on
the fund, simply make an IN+ entry using your money market
fund symbol in the symbol field.



The "cash accounting" approach will provide the correct tax
computation and will also generate a separate interest line
item in the annual interest report.  Technically, this
income should be reported to the I.R.S. as a dividend.  The
only other disadvantage of this approach is that it does not
permit a meaningful ROI to be separately computed for the
money market fund.


Certificates of Deposit
─────────────────────────────────────────────────────────────
The treatment of certificates of deposits depends on whether
interest is reinvested until maturity or is credited to
95
another account.  In the case where a C.D. has interest
reinvested, the IRI transaction is used as follows:

  Mo/Dy/Yr TAC Symbol Lot   Description     Quantity     Amount    Est. Tax
  == == == === ====== === =============== =========== ============ ========
   3/15/88 BYD CD1$       dep/buy CD#1       20000.00    -20000.00
   4/15/88 IRI CD1$       CD int reinvest      135.45       135.45
      :
   3/15/89 IRI CD1$       CD int reinvest      144.10       144.10
   3/15/89 SLW CD1$       redeem CD         -21680.00     21680.00        0m

Note that the last interest payment in the example is
treated as a reinvestment even though it is redeemed the
same day.

If the interest on a C.D. is not reinvested but is withdrawn
in the form of a quarterly check from the bank, the series
of transactions would appear as follows:

  Mo/Dy/Yr TAC Symbol Lot   Description     Quantity     Amount    Est. Tax
  == == == === ====== === =============== =========== ============ ========
   3/15/88 BYD CD1$       dep/buy CD#1       20000.00    -20000.00
   6/15/88 INW CD1$       CD interest chk                   420.00
   9/15/88 INW CD1$       CD interest chk                   420.00
  12/15/88 INW CD1$       CD interest chk                   420.00
   3/15/89 INW CD1$       CD interest chk                   420.00
   3/15/89 SLW CD1$       redeem CD         -20000.00     20000.00        0m

Note that in both examples the base currency symbol "$" was
embedded in the symbol so as to bypass the cost basis
calculation.  This is possible because it is assumed the
C.D. is to always be valued at $1/share. Note also that the
closing "sell" transaction has a zero manual tax entry so as
to suppress reporting of the sale on the capital gains
report.



Zero Coupon Bonds
───────────────────────────────────────────────────────────
Zero Coupon Bonds do not pay the holder interest, but are
instead issued at a price which is at significant discount
from the bonds' redemption (face) value.  For example, a
five-year $10,000 face value bond might be sold at issue for
$6211.20.  The I.R.S. does not allow the gain from issue to
redemption to be treated as capital gain income.  Instead it
requires the holder to report a portion of the gain each
year as ordinary income.  This portion is determined by
computing an imputed interest on the bond.

The PIN or ACR transaction codes must be used to provide
proper treatment of zero coupon bonds.  These transactions
do not affect the cash balance in the portfolio but are
recognized in PFROI's income reports and tax computations.
Treatment of zero coupon bonds using the PIN code is as
follows:

 1) A BUY transaction is entered upon purchase of the bond.
    For the automatic "Calc" command to work, the original
96
    BUY (or BYD) transaction for the bond must indicate the
    maturity date in the BUY transaction description field
    using the format "##1/15/94".  A maturity price of "100"
    is automatically assumed unless another price is
    indicated by using the format "##1/15/94 $1000".  Lot
    numbers must be assigned to the original purchase
    transaction and subsequent PIN (or ACR) transactions if
    the same issue of a ZCB bond is purchased on several
    different dates.

 2) A PIN (or ACR) transaction is entered for each year the
    bond is held.  The imputed interest for the year is
    entered in the Amount field.  The bond issuer may
    provide you with this figure, otherwise refer to I.R.S.
    Publication 1212 for computation.  Use 12/31 as the
    transaction date, unless the bond was redeemed in the
    current year, in which case use the redemption date.

    The "Calc" (Alt+C) command may also be used to calculate
    the amount for the PIN or ACR transactions. To execute
    this command, move the cursor to the start of the Amount
    field of the PIN or ACR transaction and key "Alt+C".
    You should see the proper PIN amount appear there.  This
    feature can be a real time-saver at tax time if you have
    a lot of bonds.

 3) A SLL transaction is entered upon sale or redemption of
    the bond.  If proceeds do not equal the purchase price
    plus phantom interest earned to date, PFROI treats the
    excess or shortfall as a capital gain or loss.

In the case of the bond described above, the appropriate
transactions are as follows:

  Mo/Dy/Yr TAC Symbol Lot   Description     Quantity     Amount    Est. Tax
  == == == === ====== === =============== =========== ============ ========
   4/ 1/85 BUY ZCB      1 ZCB ##4/1/90              1     -6211.20
  12/31/85 PIN ZCB      1 ZCB phant int                     465.05      130
  12/31/86 PIN ZCB      1 ZCB pin                           667.70      187
  12/31/87 PIN ZCB      1 ZCB pin                           734.48      206
  12/31/88 PIN ZCB      1 ZCB pin                           807.92      226
  12/31/89 PIN ZCB      1 ZCB pin                           888.72      249
   4/ 1/90 PIN ZCB      1 ZCB pin                           224.93       63
   4/ 1/90 SLL ZCB      1 Sell ZCB                  -1    10000.00

If the bond is sold before maturity the transactions look
somewhat different as follows:

  Mo/Dy/Yr TAC Symbol Lot   Description     Quantity     Amount    Est. Tax
  == == == === ====== === =============== =========== ============ ========
   4/ 1/85 BUY ZCB      1 ZCB ##4/1/90              1     -6211.20
  12/31/85 PIN ZCB      1 ZCB phant int                     465.05      130
   6/30/86 PIN ZCB      1 ZCB pin                           333.85       93
   6/30/86 SLL ZCB      1 ZCB pin                  -1      7410.10       37

Note in this latter case the bond was sold at a premium over
the cost basis plus phantom interest.  Zero coupon bonds
should be valued using market prices. If these are not
readily available, the bond can be valued at its purchase
97
price plus "phantom interest" earned to date as indicated by
the Cost field on the "Position" record display.


Premium Amortization
────────────────────────────────────────────────────────────
I.R.S. rules allow optional amortization over a bond's life
of a purchase premium paid in acquiring the bond. In the
case of a bond with taxable interest the amortization amount
is deductible from current year income, with the bond's cost
basis reduced accordingly.  In the case of a tax-free bond,
the I.R.S. requires the amortization of the premium
(reduction cost basis) but does not allow deduction of the
amortized amount.

AMT transactions may be used to accomplish amortization.
The amortization amount may be calculated using the Alt+C
command in the same fashion as for the PIN transaction used
for zero coupon bonds (see above). If the bond is tax-free,
enter a zero in the "Est. Tax" field.



Split Shares Received After Sale
────────────────────────────────────────────────────────────
Occasionally a security is sold after a split is declared
but before the split shares are received.  This may be
handled as follows so as to get correct valuations and cost
bases for capital gains:

  Mo/Dy/Yr TAC Symbol Lot  Description     Quantity     Amount    Est. Tax
  == == == === ====== === =============== =========== ============ ========
   1/01/87 BUY XYZ      1 xyz corp.               200     -4000.00
   6/02/87 SLL XYZ      1 xyz corp.              -100      3000.00
   6/05/87 SP+ XYZ        xyz 3/2 split            50
   6/05/87 RCV XYZ      2 xyz shrs rec.            50         0.00
   6/12/87 DLV XYZ      2 xyz shrs ret.           -50        -0.00        0m

Split shares received for a security already sold are indi-
cated by the RCV transaction, their return are indicated by
the DLV transaction.


Depreciable Assets/Real Estate
────────────────────────────────────────────────────────────
Five transaction codes, DPR, BRW, RPY, RNT, and EXP
(depreciate, borrow, repay, rent, expense) support the
inclusion of depreciable assets in PFROI portfolios.  Use of
these transactions is shown in the following example
involving the purchase of a building using a mortgage,
receipt of rent, incurrance of expenses, and subsequent sale
of the building:

  Mo/Dy/Yr TAC Symbol Lot   Description     Quantity     Amount    Est. Tax
  == == == === ====== === =============== =========== ============ ========
  01/02/80 BRW BLDG     1 Mortgage             -85000     85000.00
  01/02/80 BUY BLDG     2 Buy Bldg                  1   -100000.00
  02/01/80 RNT BLDG       rent receipts                     800.00
  02/01/80 EXP BLDG       maint. exp.                      -100.00
98
  02/01/80 DPR BLDG       Depreciation                     -550.00
  02/01/80 RPY BLDG     1 Princ. pmt.           24.75       -24.75
  02/01/80 IN- BLDG       interest pmt.                    -675.25
      :
  05/01/85 RNT BLDG       rent receipts                     950.00
  05/01/85 EXP BLDG       maint. exp.                      -135.55
  05/01/85 DPR BLDG       Depreciation                     -550.00
  05/01/85 RPY BLDG     1 Princ. pmt.           68.75       -24.75
  05/01/85 IN- BLDG       interest pmt.                    -631.25
  05/02/85 SLL BLDG     2 Sell Bldg                -1    104000.00
  05/02/85 RPY BLDG     1 Loan Payoff        83028.78    -83028.78

Note that IN- transactions are used to indicate the interest
portion of mortgage payments.


Margin Accounting
────────────────────────────────────────────────────────────
Portfolios with margin purchases may be handled in two ways.
The first is to merely make BUY transactions without full
matching DPF transactions to compensate for the purchase
amounts.  Margin interest payments are entered using the IN-
transaction:

 Mo/Dy/Yr TAC Symbol Lot   Description     Quantity     Amount    Est. Tax
 == == == === ====== === =============== =========== ============ ========
 01/02/87 DPF            Open Mrgn Acct                  10000.00
 01/05/87 BUY IBM      1 Buy IBM on mrgn         100    -15000.00
 01/31/87 IN- BRKR       Broker Mrgn Int.                  -33.50

This will cause "CASH" in the position records to go
negative to the extent margined as follows:

                            12/31/87 Position : SMITHPF
  Esc Arws Pg ^Pg Alt + Tot Prn Dspl Import Help Bat dLnk
  T Symbol Descrip    Position  Mkt Price   $ Value     $ Cost     Gains  Val %
  = ====== ========= ========== ========= =========== =========== ======= =====
    *CASH*                                   -5033.50    -5033.50       0  -51%
    IBM    IBM              100  150.0000    15000.00    15000.00       0  151%
           Gr. Total                          9966.50     9966.50       0  100%

The second method is to use the BRW transaction along with
"short" IRI transactions:

  Mo/Dy/Yr TAC Symbol Lot   Description     Quantity     Amount    Est. Tax
  == == == === ====== === =============== =========== ============ ========
  01/02/86 DPF            Open Mrgn Acct                  10000.00
  01/05/86 BRW MRGN$    1 Borrow frm Broker     -5000      5000.00
  01/05/86 BUY IBM      1 Buy IBM on mrgn         100    -15000.00
  01/31/86 IRI MRGN$    1 Broker Mrgn Int.     -33.50       -33.50

Automatic sign assignment must be turned "Off" to enter the
IRI transaction with negative signs. The base currency
symbol "$" is embedded in the security symbol "MRGN$" so as
to deactivate cost basis calculations on the margin account.
This is possible because by definition the unit quantity and
amounts are always equal. The resulting position screen will
appear as follows:

99
                          12/31/87 Position : SMITHPF
 Esc  Pg ^Pg Alt + Prn Tot Aux Dspl Qprc Sprc dLnk Mst Grph Cxr Xml Inc Hlp
 T Symbol Descrip    Position  Mkt Price   $ Value     $ Cost    Gains  Val %
 = ====== ========= ========== ========= =========== =========== ======= =====
   *CASH*                                       0.00        0.00       0    0%
   IBM    IBM              100  150.0000    15000.00    15000.00       0  151%
   MRGN$  Borrow fr -5033.5000    1.0000    -5033.50    -5033.50       0  -51%
          Gr. Total                          9966.50     9966.50       0  100%


GNMA's/Mortgage Loans
─────────────────────────────────────────────────────────────
Return of principal on GNMA's (a security consisting of
pooled home mortgage loans, backed by government insurance)
and on individual mortgage loans should be treated as
separate SLL transactions from accompanying interest
payments. Usage of first-in first-out tax lot accounting is
recommended.

For example, you have purchased $10000 of a GNMA consisting
of 30 year loans averaging 11%. It is held in a brokerage
account with the proceeds of interest and principal payments
credited to cash. Your transaction entries would appear as
follows (figures approximate):

  Mo/Dy/Yr TAC Symbol Lot   Description     Quantity     Amount    Est. Tax
  == == == === ====== === =============== =========== ============ ========
  01/02/90 BYD GNMA     1 Buy GNMA              10000    -10000.00
     :
  03/31/90 SLL GNMA     1 GNMA Princ. redeemed  -3.20         3.20
  03/31/90 IN+ GNMA     1 GNMA int. pmt.                     92.60
     :

Upon receipt of the last mortgage or GNMA payment the
"quantity" held should go to zero.


Safe Deposit Box Shares
───────────────────────────────────────────────────────────
Often investors keep all or part of their investments in the
form of certificates held in a safe deposit box. You may wish
to define the "Box" as a separate portfolio from your
brokerage accounts. In this case you buy and sell securities
in your brokerage portfolio and use the RCV and DLV trans-
actions to move shares to and from the "box" portfolio. A RCV
transaction may be entered in a brokerage portfolio up to one
month after a sell transaction to signify receipt of a
security into the portfolio from the safety deposit box.
Assigning the same lot number to the RCV transaction as the
SLL transaction will force cost matching.


Reverse Splits
────────────────────────────────────────────────────────────
Use the SP+ transaction code for reverse splits, but enter a
negative quantity (use Alt+G to toggle automatic sign
assignment "Off" for this input, but don't forget to turn
it back "On"!). See Chapter 6, SP+ transaction code for an
example of a reverse split.



100
Same-Day Trades
────────────────────────────────────────────────────────────
Active traders occasionally will buy and sell a security on
the same date.  Even if you are an inactive trader you may
find yourself selling mutual fund shares on the same date
that dividends or capital gains are being reinvested.

PFROI calculates the cost basis of same-date purchase (BUY,
BYD, BYC, DRI, IRI, etc) and sell (SLL, SLW, SLS, etc)
transactions in the same security in a given lot in the
order that the transactions occur in the portfolio file.
Thus to obtain correct cost bases, a SLL transaction must be
preceded by sufficient BUY transactions to accumulate enough
shares to facilitate the SLL.  However, if in fact a sell
occurs earlier in the day than the  purchase of covering
shares then SLS and BYC transactions should be used instead.


Dividends/Interest/Splits Same Day as Sale
────────────────────────────────────────────────────────────
Dividends or splits which occur on the same day of a sale of
stock, bond or mutual fund should be placed BEFORE the sell
transaction in the transaction listings.


Commodities
────────────────────────────────────────────────────────────
Commodities and commodity futures and futures options may be
handled like any other security. However, the value used in
the Quantity field of transactions must be consistent with
the pricing entered in the Mkt Price field on position
records.  E.g., if corn is to be priced at $2.50/bushel,
corn future contracts valued at $100,000 must have a
quantity of 40000 (bushels). For example, a sequence of Buy/
Sell transactions in corn futures would appear as follows,
assuming $400 commission per transaction:

  Mo/Dy/Yr TAC Symbol Lot   Description     Quantity     Amount    Est. Tax
  == == == === ====== === =============== =========== ============ ========
  10/03/88 BYD CORN5    1 5/89 Corn @2.93       10000    -29700.00
     :
  01/31/89 SLL CORN5    1 5/89 Corn @2.88      -10000     28400.00

You may need to modify tax rate records to specify different
tax requirerates for commodities.  Consult with your tax
advisor on these requirements.



Corporate Dividend Reinvestment
──────────────────────────────────────────────────────────────
If you reinvest dividends under a company reinvestment plan,
you may be liable for tax on trading commissions if these
are absorbed by the company rather than being passed through
to you. Ordinarily you will be notified by the company if
this is the case. If so, use the CBA TAC to reduce the cost
basis of your shares by the amount specified by the company.
This will result in your paying the tax on the implied
commission upon sale of the shares.

101
For example, you reinvest a $425 dividend from a utility at
$30/share, with commissions of 0.25% absorbed by the
company:

  Mo/Dy/Yr TAC Symbol Lot  Description     Quantity     Amount    Est. Tax
  == == == === ====== == =============== =========== ============ ========
  04/15/90 DRI UTIL    1 Util Div Reinv.     14.1667       425.00
  04/15/90 CBA UTIL    1 Absorbed Commis                    -1.06


Employer Contribution Retirement (401K) Plans
──────────────────────────────────────────────────────────────
Employee and matching corporate contributions to 401K
retirement plans and other similar plans are best handled by
using a BYD transaction for the contribution in which both
the quantity and amount are identical. You may use separate
lot numbers to identify your contributions versus your
employer's contributions. For example, starting in January
1990 you contribute $250 per month with an equal amount
matched by your employer:

  Mo/Dy/Yr TAC Symbol Lot  Description         Quantity    Amount    Est. Tax
  == == == === ====== === =================== ========== =========== =========
  01/02/90 BYD 401K     1 401K Plan, My contr.       250     -250.00
  01/02/90 BYD 401K     2 401K Plan, Their contr.    250     -250.00
     :

In this example, at the end of the year you and your employer
have contributed a total of $6000. If the plan trustee
reports that your holdings in the plan are now worth $6750 on
12/31/90.  You enter the "6750" in the "$ Value" field on the
Position screen resulting in the "Mkt Price" being
automatically calculated as follows:

                            12/31/90 Position : MY401K
  Esc  Pg ^Pg Alt + Prn Tot Aux Dspl Qprc Sprc dLnk Mst Grph Cxr Xml Inc Hlp
  T Symbol Descrip    Position  Mkt Price   $ Value     $ Cost     Gains  Val %
  = ====== ========= ========== ========= =========== =========== ======= =====
    *CASH*                                       0.00        0.00       0    0%

    401K   401K Plan       6000    1.1250     6750.00     6750.00       0  100%


Undistributed Capital Gains
──────────────────────────────────────────────────────────────
Occasionally a mutual fund will report an
"Undistributed Capital Gain". Use a CGR TAC code for
undistributed capital gains, but specify a very small
non-zero number for the quantity, e.g. "0.0000001" so
that the cost bases is correctly calculated for open
lot reports.


Capital Loss Distribution
──────────────────────────────────────────────────────────────
Occasionally a mutual fund will report a capital loss
distribution. Use a CGR (or SGR) TAC code,
temporarily turn "siGn=Off" and enter negative
quantity and amount.  Place the notation "=L+" in the
102
description field to force the transaction to be
treated as a "Long" position transaction rather than
a "Short" position transaction.



103




8 PFROI - Understanding ROI & Beta
───────────────────────────────────────────────────────────

Return On Investment

Return on investment (ROI) is true measure of investment
performance.   ROI is properly computed using the "internal
rate of return" method. This method takes into account both
the timing and the amount of cash flows into and out of an
investment.

On a layman's level however, it is easiest to think of
"return on investment" as the effective annual interest rate
on an investment.  The effective annual interest rate you
receive on a savings account or money market fund is in fact
the ROI on that account or fund.

PFROI computes the return on investment on a portfolio by
determining the annual interest rate which would generate an
identical ending value in a savings account with the same
history of deposit and withdrawal of funds as the portfolio.

The ROI on an individual security is computed in a similar
fashion except that in lieu of deposits and withdrawals,
security transactions are reduced to "cash flows" and the
resulting cash flows (plus starting valuation and ending
valuation) are used to compute the ROI.  One concept that
some persons have difficulty with is that, for individual
security ROI's, dividends, interest, return of capital and
like payments are classified as "removal of funds" on the
ROI summary.  This is because unless the recipient of such
payments reinvests the payments his or her equity interest
in the security is effectively reduced. That this is a real
effect can be seen by observing that on average the price of
a security drops by the amount of its dividend on the date
that it sells "ex-dividend.


ROI Annualization

On PFROI's performance screen ROI is reported on an
annualized basis to permit easy comparison between ROI
results.  This means that even if the ROI period is for just
3 months the reported result is converted to what it would be
if the same performance continued over a full 12 months.
Thus if your portfolio advances 10% over 3 months without any
deposits or withdrawals the reported ROI will be about 46.4%
( (1.1 x 1.1 x 1.1 x 1.1 - 1.0) x 100).  In making the
annualization conversion it is assumed there are 365 and 1/4
days per year to take into account leap year.

In reviewing ROI results you should be aware that over short
periods (e.g. a day, week, or month), seemingly small price
movements (e.g. $2 on a $20 stock) can result in a large
absolute ROI values due to annualization. This will be
104
particularly evident in the ROI of individuat securities in
cases where all or the majority of a holding are either sold
shortly after the beginning of an ROI period or are added to
a portfolio shortly before the end of an ROI period. The
effective holding period for a security in these cases is
short, thus causing normal "small" price movements to have a
large effect on annualized ROI.

Such ROI's may be suppressed from the ROI by Securities report by
placing the notation "/*=30" at the end of the ROI by Security
report customization specification where "30" (or some other
number) is the maximum negative ROI/Yr which will be reported
and 100 / (1-.30) is the maximum positive ROI/Yr which will be
reported for a partial period security. If the limit is exceeded,
an estimated non-annualized "partial period" ROI will be computed
and reported with a following asterisk, e.g. "3.5%*".  If no
meaningful non-annualized ROI can be computed "*****" will be
reported.


Short Sale ROI's

A meaningful ROI cannot be computed for individual securities
involved in short sale transac-tions, and an attempt to do so
may result in a "Convergence failure" message.  This is
because short-sale transactions have open-ended investment
risk.  Short-sale transactions contained within a larger
portfolio generally however will not impede the computations
of ROI for the portfolio as a whole.


Time-Weighted ROI's

In reading the investment literature you may also encounter
the terms "Dollar-Weighted ROI" and "Time-Weighted ROI". The
"Dollar-Weighted ROI" is the same as the internal rate of
return computation described above. The "Time-Weighted ROI"
is the mathematical average of a series of "Dollar-Weighted
ROI" calculations and can be implemented by setting the
Twtd switch to "On" on the Configuration menu and on the
Performance screen.

The "Time-Weighted ROI" tends to be more often used by
investment professionals quite frankly because it makes
their record look better. The individual investor is best
advised to stick with the "Dollar-Weighted ROI.


Beta Statistic Calculation

Beta is a statistical measure of the price volatility of a
security or portfolio of securities versus the price
volatilty of a market index such as the S&P500 index. Beta is
often used by investors as a measure of the market risk of
their investments. A Beta of "0" indicates an investment with
no market risk. An example of such an investment is cash or
short-term Treasury Bills. A beta of "1.0" indicates an

investment of equal risk as compared with the target market
105
index. A beta of "2.0" would indicate double the risk.

The Beta statistic is often reported for individual
securities in reports issued by investment analysis firms
such as Value Line, Inc. and Standard & Poors, Corp. These
reported values may be used for input in the Beta field on
PFROI's Master Security List or on PFROI's Position Screen.
The value-weighted average of beta reported at the bottom of
the Position Screen can then be taken as a measure of the
riskiness of the portfolio as of the date of the position
record. We call this Beta the "Static" Beta.

If PFROI computes an ROI which spans at least twelve
valuation periods and the Twtd switch is set to "On", then
PFROI will also compute and report a Beta for the portfolio
or securities specified by the ROI mask record. Unlike the
Beta computed on the position screen which represents a
single, static point in time, the Beta computed in conjunc-
tion with the ROI is a dynamic measure of Beta. This measure
takes into account not only the beta's of the individual
securities which comprise the portfolio, but the change in
the portfolio composition and weighting over time as
securities are bought and sold and increase or decrease in
value.

The "Dynamic" Beta thus reflects not only the riskiness of the
individual securities comprising the portfolio, but also
reflects the risk level contributed to the portfolio due to
the timing of the portfolio manager's Buy/Sell decisions. In
general, a portfolio manager who is able to keep his or her
dynamic Beta below his portfolio's static Beta is reducing
portfolio risk and increasing portfolio returns due to good
timing decisions.

PFROI also reports an "Alpha" and "Correlation" in connection
with the "Beta" reporting.  We don't have room to cover these
here, however we refer the user to a good MBA level financial
textbook.
106

 (page intentionally blank)
107




9 DATALINK Communications
────────────────────────────────────────────────────────────


DataLink Overview
────────────────────────────────────────────────────────────
The DataLink communication module may be used to download
security price data into PFROI portfolio and batch valuation
records and into PFROI Price History records. The DataLink
module may also be used in its "SmartTerm" mode for manual
interactive communication with electronic bulletin board
services.

The DataLink module is designed to be flexible so as to
allow it to be configured to interface with many different
data services and so as to allow the user to make minor
modifications in its communications "script" to accomodate
data service format changes.  As such, the contents of the
as-shipped DLINK.STD communication script file may differ
somewhat from some of the examples shown in this chapter. In
these cases you should treat the script in the "as-shipped"
DLINK.STD as the most current.

DataLink requires a Hayes-compatible 300/1200/2400 autodial
type modem. Other modems may be usable provided you modify
the standard DataLink log-on scripts to conform with your
modem's command language.


DataLink Access
──────────────────────────────────────────────────────────
The DataLink module may be accessed from a PFROI Portfolio
Position screen, or from a Price History record screen by
executing the "dLink" command (Alt+L). When entered in this
manner, the DataLink "Autoquote" command may be used to
price the record from which it was accessed.


DataLink Record
──────────────────────────────────────────────────────────
Upon entering the DataLink module, the default DataLink
specification file DLINK.STD is loaded.  The screen will
then display the first of a number of DataLink access
records. The DataLink record for connection to Dow Jones
through Tymnet appears as follows:
108

╔═══════════════════════════ DLINK.STD Log-On Specs ══════════════════════════╗
║ Service Name    : Dow Jones NR (Tymnet Access) call: 609-452-1511           ║
║ Phone <PH>      : Tymnet Phone #                                            ║
║ User ID <USR>   :                                                           ║
║ Password <PW>   : Your DJNR Password                                        ║
║ Com. Specs.     : COM2:1200,E,7,1                                           ║
║ Dial Script     : ATDT<PH>^R^WCONNECT                                       ║
║ Log-On Script   : ^P^PA^W: DOW1;;^W?? DJNS^R^W@@ <PW>^R^WQUERY              ║
║ Log On (contd)  :                                                           ║
║ Log-Off Script  : ^PDISC^R^P+++^PATH^R^P                                    ║
║ Log Filespec    : DJNRS.LOG                                                 ║
╠═══════════════ Retrieval Specs - DEMOPF 03/31/90 to 04/01/90 ═══════════════╣
║ 1) Portfolio Quotes, Cur. Date                                              ║
║ 2) Portfolio Quotes, Spec Date                                              ║
║ 3) Price Record Quotes, Single Date                                         ║
║ 4) Price Record Quotes, Multi-Date                                          ║
║ 5) Fundamental Data Retrieval                                               ║
╠════ Pg ^Pg Ins Del  Alt + File Edit Sterm Aquote Cspecs Range Dup Help ═════╣
║                                                                             ║
║ >                                                                           ║
║                                                                             ║
╚═════════════════════════════════════════════════════════════════════════════╝

As previously noted, the above example is just one of several
communication records in DLINK.STD.  Each record contains
communication "scripts" for a different data source or
telephone access network. Use the PgDn and PgUp keys to view
these other records.  These records may differ somewhat from
examples in this chapter. In these cases assume that the
DLINK.STD disk file record is more current than the example.

The "scripts" in the communication records replace manual
keystokes. This permits you to flexibly configure modem
setups, dial-up/log-on scripts, and quote requests to fit the
online service with which you are working.

Available DataLink record commands operate as follows:

 Pg    - PgUp and PgDn key move you to preceeding and
         following records respectively.

 ^Pg   - Ctrl+PgUp moves to first DataLink record. Ctrl+PgDn
         moves to last DataLink record.

 Ins   - Inserts a blank DataLink record. This may be edited
         to add your own communication scripts.

 Del   - Deletes the displayed DataLink record.

 ^F5   - Ctrl+F5 duplicates existing record.  The duplicated
         record may be edited to create a modified script
         without losing the script in the original record.

 ^Home - Ctrl+Home moves the currently displayed DataLink
         record to the head of the DataLink file. This
         record will be the first to appear the next time
         DataLink is accessed.

109
 Alt+E - Initiates "Edit" mode, permitting editing of the
         record scripts (e.g. "Comm. Specs.", "Log-On
         Scripts", etc.).

 Alt+S - Initiates "Smart Terminal" communications using the
         scripts in the current record.

 Alt+A - Initiates automatic quote retrieval using the
         scripts in the current record. You must have
         accessed DataLink from a Portfolio or Batch
         Position screen or from a Price History record
         screen for this command to be operative.

 Alt+C - Accesses communications default parameters. For
         details on how these operate see Communication
         Defaults later in this chapter.

 Alt+R - Enables you to reset the "End Date" of the Date
         Range for price history quote downloads, quote
         request type "4".

 1..5  - Accesses data Retrieval Spec. records.

The DLINK.STD file as provided on the distribution diskette
contains records to allow you to connect with Compuserve, the
Dow Jones News Retrieval Service, and plus some other
services. To make operative for current quotes, in most cases
you should only need to insert the local access phone number
of the service and your password using the edit (Alt+E)
function.  Some modems may also require a change in the Com.
Specs.


Log-On Specifications
────────────────────────────────────────────────────────────
The first part of the DataLink record contains the Log-On
specifications.  These are used to automatically log onto a
service when invoking the "Autoquote" (Alt+A) or "SmartTerm"
(Alt+S) commands.

An example of the Log-On Specifications is shown below,
followed by explanations of field contents.

110
╔═══════════════════════════ DLINK.STD Log-On Specs ══════════════════════════╗
║ Service Name    : Compuserve Info. Services, Call 614-457-8600              ║
║ Phone <PH>      : CIS Phone #                                               ║
║ User ID <USR>   : Your CIS User ID                                          ║
║ Password <PW>   : Your CIS Password                                         ║
║ Com. Specs.     : COM2:1200,E,7,1                                           ║
║ Dial Script     : ATDT<PH>^R^WCONNECT                                       ║
║ Log-On Script   : ^P^C^W: <USR>/GO:MQUOTE\<PW>^R^W!                         ║
║ Log On (contd)  :                                                           ║
║ Log-Off Script  : ^C^W! /OFF^R^P^P+++^PATH^R                                ║
║ Log Filespec    : CIS.LOG                                                   ║
╠═══════════════ Retrieval Specs - DEMOPF 03/31/90 to 04/01/90 ═══════════════╣
║ 1) Portfolio Quotes, Cur. Date                                              ║
║ 2) Portfolio Quotes, Spec Date                                              ║
║ 3) Price Record Quotes, Single Date                                         ║
║ 4) Price Record Quotes, Multi-Date                                          ║
║ 5) Fundamental Data Retrieval                                               ║
╠═════ Pg ^Pg Ins Del  Alt + File Edit Sterm Aquote Cspecs Range Dup Help ════╣
║                                                                             ║
║ >                                                                           ║
║                                                                             ║
╚═════════════════════════════════════════════════════════════════════════════╝

 Service Name - This field is purely informational.

 Phone <PH> - Telephone number to reach the service.
 DataLink substitutes this number where "<PH>" appears in
 the Dial Sequence.

 User Ident. <USR> - Some services require both a user
 identification and password for access.  This field accepts
 the user identification.  DataLink substitutes this
 identification into the Logon Script (below) wherever
 "<USR>" appears in that sequence.

 Password - This is the service's logon password. DataLink
 substitutes this password into the logon script (below)
 wherever "<PW>" appears in that sequence.

 Com. Specs - This specification is used by DataLink to set
 up the communications port which connects your PC with your
 modem.  The same format as DOS's "Mode" command for serial
 ports is adhered to in this field:

  COM2: - Indicates serial port #2 is used. You may have to
          change this to COM port #1, #3 or #4 if those
          ports are used by your modem.

  1200  - The baud rate.  You may use 300, 1200, or 2400 baud.

  E     - Parity (N=None, E=Even O=Odd)

  7     - Data bits per byte (usually 7 or 8 depending on
          the system with which you are communicating)

  1     - Number of stop bits (1 or 2) (Note: if Parity=N &
          Data Bits=7, then stop bits must be 2)

  +     - If the com. spec. is terminated by a "+", echo is
111
          set "On".  "Echo" can be toggled during
          communications with the Alt+E command.

 The baud rate, parity, data bits and stop bits must be
 compatible with both your modem and the system with which
 you are communicating. If you hear no dialing when
 attempting the Alt+S or Alt+A commands, try changing the
 port specification to "COM2:" (or vice versa from COM2 to
 COM1). If dialing occurs but "gibberish" appears on the
 screen upon making the connection, try changing baud rate,
 parity, data bit and stop bit parameters ("1200,E,7,1" or
 "1200,N,8,1" suggested).

 Dial Script - DataLink uses this script to send characters
 to your modem to cause it to dial-up and establish a link
 prior to trying to log onto an on-line service.  The numbers
 specified in the Phone field are substituted for <PH>.  The
 exact characters to use prior to <PH> depend upon your
 modem, the ones shown work for a Hayes compatible modem.
 The character sequence ^WCONNECT indicate that PFROI should
 "wait" to receive the message "CONNECT" before proceeding.
 (Note: Some modems, particularly in non-English speaking
 countries are set to respond with the character "1" in lieu
 of the word "CONNECT".  Change your modem settings to
 generate "CONNECT" or modify the script to replace "CONNECT"
 with "1".)

 IMPORTANT: If you have an "MNP" type modem you may have to
 modify the Dial Script to put the modem in the "normal"
 mode.  Try the following:  AT\N DT<PH>^R^WCONNECT

 Log-On Script - This character sequence is transmitted as
 soon as your modem indicates a successful connect with the
 service. The exact sequence used depends upon the log-on
 protocall of the data service you are using, however the
 sequence will usually require "^W" and "^P" flow control
 characters as discussed in the next section.

 Log-Off Script - This sequence is transmitted on the
 termination of an autoquote session. It should contain the
 service log-off command, (e.g.  DISC, OFF or BYE), a command
 to return to the modem command level (e.g. ^P+++^P) and a
 command to tell the modem to hang-up (e.g. ATH^R).

 Log Filespec - This is the filename to which communications
 are saved if the "Record" or "Save" functions are activated.

The DataLink Log-on Specifications may be edited by execut-
ing the the Alt+E (Edit) command.


Script "Flow Control" Characters
────────────────────────────────────────────────────────────
In general, in the DataLink Log-On and Retrieval Specifi-
cations characters preceeded by a '^' are converted to ASCII
control characters before being sent (e.g. "^^"=ASCII 30 &
"^Q"=ASCII 17 in the preceding script example).

112
Exceptions are the ^P, ^R, and ^W characters, which are used
for communication "flow control" as follows:

 ^P  - Causes a pause for the number of seconds specified in
       the DataLink Communication Parameters (Alt+C cmd).

 ^R  - Transmits a "carriage return" character (ASCII 13).

 ^W  - Initiates a "wait" until the character sequence
       following the ^W is received. This sequence must be
       ended by a "space" character, for example, the
       sequence "^WENTER:  1^R" means "wait for the prompt
       "ENTER:" then send the character "1" followed by a
       carriage return.

       If the specified character sequence following ^W is
       not detected after the "Wait Time" specified in the
       DataLink communication specifications (i.e. it "times
       out"), then DataLink proceeds with the remainder of
       the communication string.

HINT:  If you find that DataLink "times-out" too quickly at
specified "wait" points, try increasing "Receive Wait" and/or
"Connect Wait" on the Communication Parameters (Alt+C).

If you wish to enter the actual ^P, ^R or ^W in scripts
without them being interpreted as a flow control character,
enter the ASCII values on the number pad by keying in the
ASCII value (^P=16, ^R=18, ^W=23) while holding down the Alt
key. The icon representing the ASCII value will appear on
the screen.


Retrieval Spec. Records
───────────────────────────────────────────────────────────
The second part of the DataLink record provides access to
DataLink's quote retrieval specification records. These
records contain specifications and scripts which are used to
retrieve price quotes and other data whenever the AutoQuote
command is invoked.

╠══════════════ Retrieval Specs - DEMOPF 03/31/90 to 04/01/90 ═══════════════╣
║ 1) Portfolio Quotes, Cur. Date                                             ║
║ 2) Portfolio Quotes, Spec Date                                             ║
║ 3) Price Record Quotes, Single Date                                        ║
║ 4) Price Record Quotes, Multi-Date                                         ║
║ 5) Fundamental Data Retrieval                                              ║
╠════ Pg ^Pg Ins Del  Alt + File Edit Sterm Aquote Cspecs Range Dup Help ════╣
║                                                                            ║
║ >                                                                          ║
║                                                                            ║
╚════════════════════════════════════════════════════════════════════════════╝

Note that the filename and dates of the records from which
DataLink was accessed are indicated on the DataLink record.
The second date may be modified by using the Alt+R command
if this record was accessed from the Price History records.

113
Separate retrieval specifications are provided for each data
destination as follows:

 Portfolio Quotes, Current Date - Used for retrieving "current"
 quotes into PFROI portfolio or batch position records. Use
 this selection whenever you want to retrieve the latest market
 quotes into current position records.

 Portfolio Quotes, Spec. Date - Used for retrieving quotes for
 a specified date into PFROI portfolio or batch position
 records. Use this selection whenever you want to retrieve
 market quotes into prior-dated position records. The date of
 the position record will automatically be used in lieu of
 "<DT1>" in the quote retrieval spec. when the date of the
 quote is requested by the quote service.

 Price Record Quotes, Single Date - Used for retrieving quotes
 into Price History records for a single record date. The date
 used is the same as the first date shown following the
 destination record filename. See Price Quote Retrieval later
 in this chapter for more detail on retrieving price quotes.

 Price Record Quotes, Multi-Date - Used for retrieving quotes
 into Price History records for multiple record dates. The
 "start" date used is the same as the first date shown
 following the destination record filename. The "end" date is
 the second date shown. Upon entering DataLink this second date
 is initialized to be the same as the start date, but may be
 edited to another value by executing the "Range" command. See
 Price Quote Retrieval later in this chapter for more detail on
 retrieving price quotes.

 Fundamental Data Retrieval - This selection is currently
 active in CAPTOOL for downloading fundamental financial data
 (revenues, earnings, etc.) from Compuserve into CAPTOOL's
 Stockpar records.

Although most users should have no need to do so (existing
records as provided in DLINK.STD should be adequate), retrie-
val specification records may be viewed and edited by selecting
the applicable record type (1..5) at the DataLink prompt.

Example specifications for Portfolio Position quotes and
Price History quotes from Compuserve are as follows:

 Current Date Portfolio Quotes

                               1) Retrieving  03/07/91
   Esc Pg Ins Del Alt+ Prn Aquote Cspecs Range Help
    R T                         Specification
    = = =======================================================
      ! Compuserve Portfolio Current Date Quotes
    1 * go mqint^R^Wce: 100^R^W:
    2 * <SYM>^R^W:
    3 * <SYM>^R^W:
     S <KW>="<SYM>"; [POS]=[1,(" ")];
     M <KW>="<SYM>"; [POS]=[1,(" ")];
     I <KW>="<SYM>"; [POS]=[1,(" ")];
       <KW>="<SYM>"; [POS]=[1,(" ")];

114
 Specified Date Portfolio Quotes

                               2) Retrieving  12/31/90
   Esc Pg Ins Del Alt+ Prn Aquote Cspecs Range Help
    R T                         Specification
    = = ========================================================
     ! Compuserve Portfolio Spec. Date Quotes
    0 * <DT#>="YYMMDD";
    1 * go mqint^R^Wce: 100,,<DT1>^R^W:
    2 * <SYM>^R^W:
    3 * <SYM>^R^W:
     S <KW>="<SYM>"; [POS]=[1,(" ")];
     M <KW>="<SYM>"; [POS]=[1,(" ")];
     I <KW>="<SYM>"; [POS]=[1,(" ")];
       <KW>="<SYM>"; [POS]=[1,(" ")];

                            3) Retrieving  12/31/90
   Esc  Pg Ins Del Alt+ Prn Aquote Cspecs Range Help
    R T                         Specification
    = = ======================================================
      ! Compuserve Price Rec. Quotes, Single Date
     ! CIS doesn't prompt for second date if first date is most recent market
     ! close date.  In that case you must remove second "<DT1>^R^W!" from
     ! script line #2 below.
    0 * <DT#>="MM/DD/YY";
    1 * scroll on^R^W! go prices^R
    2 * ^Wue: <SYM>^R^W: D^R^W? <DT1>^R^W? <DT1>^R^W! ^R^Wue:
    3 * <SYM>^R^W! ^R^Wue:
      B <KW>="-----"; [POS]=[1,12/100,,23,37,48];
      S <KW>="-----"; [POS]=[1,12/100,,23,37,48];
      M <KW>="-----"; [POS]=[1,12/100,,23,37,48];
        <KW>="-----"; [POS]=[1,12/100,,23,37,48];
      I <KW>="-----"; [POS]=[1,,,,,14];


                    4) Retrieving  10/01/90   to 12/31/90
Esc  Pg Ins Del Alt+ Prn Aquote Cspecs Range Help
 R T                       Specification
 = = ==========================================================
   ! Compuserve Price Rec. Quotes, Multiple Dates
  ! IMPORTANT: First date may not be most recent market close date
   ! Change "D^R" in #2 to "W^R" or "M^R" for Weekly or Monthly intervals
 0 * <DT#>="MM/DD/YY";  <ERR>="found";
 1 * scroll on^R^W! go prices^R
 2 * ^Wue: <SYM>^R^W: D^R^W? <DT1>^R^W? <DT2>^R^W!
 3 * ^R^Wue: <SYM>^R^W!
 4 * <SYM>^R^W!
   B <KW>="-----"; [POS]=[1,12/100,,23,37,48];
   S <KW>="-----"; [POS]=[1,12/100,,23,37,48];
   M <KW>="-----"; [POS]=[1,12/100,,23,37,48];
     <KW>="-----"; [POS]=[1,12/100,,23,37,48];
   I <KW>="-----"; [POS]=[1,,,,,15];

The Retrieval Specification records intentionally use a very
generalized format for flexibility. The first record is
marked by "!" in the "T" field to indicate the field is
purely informational.  Additional scripts are provided
in DLINK.STD.


115
Quote Request Scripts

Up to six records marked by "*" in the "T" field and numbered
1 to 6 in the "R" field specify quote request scripts. These
operate as follows:

0  (Definitions) - This record is used to define the date
   format to be used in the script and to optionally indicate
   what data service message indicates an error condition
   exists. The date format is specified as follows:

       <DT#>="MM/DD/YY";

   The string fragments "YY", "MM" and "DD" indicate year,
   month and day respectively.  Another typical format is
   "YYMMDD". The actual format specified is dependent upon
   the date format used by the data service for which the
   script is written. DataLink will substitute the "Range"
   Start and End dates for <DT1> and <DT2> wherever they
   occur in the DataLink Quote Request scripts using the
   indicated format.

   Error message detection and recovery is optionally
   specified by including a notation "<ERR>=" in the
   Definitions record, followed by a fragment of the error
   message which may be used to uniquely identify it, e.g.:

       <ERR>="(N)o:";

   In the Dow Jones Tradeline script in DLINK.STD in the
   fragment "(N)o:" is part of an error message Dow Jones'
   Tradeline service generates when it does not recognize a
   ticker symbol. Upon encountering this message DataLink
   executes the error recovery script specified in record #4
   described below.

1  (Quote Service Request) - DataLink executes this script
   immediately upon completing the log-on sequence. This
   script should request the quote retrieval service of the
   data service you are using. If this request is already
   included in the log-on script then this specification will
   be blank.

2  (Initial Quote Request) - This script is executed after
   the quote service request and is used to make the initial
   quote request. Note that this script may contain the date
   variables <DT1> or <DT2> for which DataLink will
   substitute an actual date using the format specified in
   the Definition record. The symbol variable <SYM> is also
   embedded in this script, for which the actual ticker
   symbol of each security is automatically substituted. If a
   security's quote destination record has been marked using
   the Alt+3 command ("#" next to symbol), the security CUSIP
   number, if found in the Master List, will be substituted
   in lieu of the ticker symbol when the quote request is
   generated. A prefix variable, <PFX>, may also be included
   in the script (depending on the data service), for which
   the prefix indicated in subsequent "Type/Position"
   specification records is substituted.

116
3  (Repeat Quote Request) - DataLink repetitively uses this
   script to respond to the data service's prompt for another
   ticker symbol following the first quote request. This
   script may also include the <SYM> and <PFX> variables.

4  (Error Recovery) - Specifies script to be executed if the
   Initial or Repeat Quote Requests encounter the predefined
   error message fragment in the Definition record (#0). In
   the Dow Jones Tradeline scripts in DLINK.STD, the script
   responds with a "N" (for No) in response the Dow Jones
   error prompt, thus causing Dow Jones to prompt for the
   next security ticker. This record is optional and is not
   used in the preceding examples.

5  (Time-Out Recovery) - Specifies script to be executed if
   the Initial or Repeat Quote scripts "Time-Out" due to
   encountering an unanticipated prompt. This record is
   optional and is not used in the preceding examples.


Type/Position Specifications

The remaining quote retrieval records are used to define
security type-specific "variables" used in quote retrieval
and to specify the position where quote figures will be
located in the data service's quote response. In general,
there should be a separate quote retrieval record for each
security type for which a quote will be requested.  These
records are specified as follows:

 R - This field is currently left blank.

 T - Security "Type" field. Indicates the "Type" of the
     security for which a quote is being retrieved, e.g.
     stock, bond, etc.  A security's "type" is defined in the
     "T" field of position and price records.

 ────────────────────────────────────────────────────────────
 Important!: When retrieving prices for a particular security
 or market index, DataLink attempts to match the "type"
 specified in the destination record with one of the
 "Type/Position" records.  If no match is found the message
 "No Type/Pos. spec. for security type" is displayed.  If
 this occurs you will need to add a Type/Position record for
 that particular security type or reassign the "Type" in the
 destination record.
 ─────────────────────────────────────────────────────────────

 Specification - This is a free-form specification field
 containing entries as follows for retrieval of price
 specifications:

  Key Word <KW> - This field defines the group of characters
  which DataLink uses as a "base position" from which to
  determine where a price quote is located. A blank entry is
  used when the base is the quote prompt. In the prior
  examples, the word "BID" is the key word for the Dow Jones
  current quote retrieval and the character string "------"
  is the key word for the DJ historical quote retrieval. If
117
  no Key Word is defined, the start of the line following the
  quote request is used as the "base position".

  If <KW>="<SYM>", the position count begins at the start of
  the following line. The notation "[L+2]" specifies to skip
  two more lines before starting the position count.


  Position [POS] - This specification defines the position(s)
  of the target quote figures relative to the previously
  defined key word. A single position is specified for
  portfolio and batch record quote retrieval, corresponding
  to the "closing" quote. Six positions, separated by commas,
  are specified for CAPTOOL price records, corresponding to
  Mo/Dy/Yr, Volume, Open, High, Low and Close quotes. The
  specified positions indicate the number of characters
  positions to the quote starting from the beginning of the
  line immediately following the line containing the keyword.

  If the quote position specification also contains
  parentheses enclosing one or more delimiting characters in
  double quotes, e.g. (" ",","), then the quote position is
  counted in "words" separated by the specified delimiting
  characters. In this case, the position count starts
  immediately from the keyword rather than from the end of
  the line containing the keyword.

  Prefix <PFX> - This specification (required for Dow Jones)
  indicates the prefix character to be used for each security
  type during quote requests.


Position Record Quote Retrieval
──────────────────────────────────────────────────────────────
Using DataLink to retrieve quotes into Portfolio or Batch
"Position" records involves the following steps:

 1) Enter the Position records by Creating a new set of
    records or by Reviewing an existing set of records. Use
    the Alt+! (Alt+1) command to mark any records for which
    you wish to suppress quote retrieval. Use the Alt+#
    (Alt+3) command to mark any records for which you wish to
    use the Cusip number from the Master List for quote
    retrieval in lieu of the ticker symbol. Toggling these
    commands a second time clears these marks.

 2) From the Position record display execute the Alt+L
    command to access the DataLink module. PgDn, if
    necessary, to get to the DataLink record for the service
    from which you wish to retrieve quotes. Check to be sure
    that you've installed a telephone number and password for
    this service. You should also check to confirm that the
    Portfolio or Client Group filename and position record
    date are displayed on the lower half of the DataLink
    menu.

 3) Execute the DataLink Alt+A command. Select quote type #1
    for current date quotes and quote type #2 for quotes as
    of the date of the position records.

118
 4) For immediate quote retrieval hit <Enter> when prompted
    for an access time. For delayed access to obtain quotes
    at a cheaper late night rate, specify a time, then hit
    <Enter>. (Note, during delayed access, your PC is tied up
    until quotes are obtained. Hold down "Esc" key to
    cancel).

 5) DataLink should automatically log-on, retrieve quotes and
    log-off. Upon returning to the DataLink screen, use the
    Esc key to return to the Position records.

 6) Review these quotes on the position screen to ensure the
    prices are in a reasonable range. If you are "batching"
    execute the Alt+U command to update individual portfolios
    from the batch screen.

The AutoQuote process may be aborted at any time by holding
down the Esc key.


Price History Quote Retrieval
──────────────────────────────────────────────────────────────
Retrieving quotes into the Price History records is a little
more involved than retrieving prices into Portfolio or Batch
position records. The steps are as follows:

 1) Enter the Price History record edit screen.

 2) Insert "empty" records with the date (impt!) the ticker
    symbols for which you wish to retrieve quotes. This may be
    done manually, but it is easier to create a single empty
    price record of the desired date and then execute the
    Ctrl+F6 command to generate duplicate records drawing
    ticker symbols from the Master Security List. Delete any
    unwanted records or use Alt+! to mark them as "No-Quote"
    records. Use the Alt+# command to mark any records for
    which you wish the Cusip number from the Master List to be
    used for quote retrieval in lieu of the ticker symbol.

 3) Position the cursor on the first price history record for
    which you wish to retrieve a quote. DataLink will start
    quote retrievals using the symbol held in this record. It
    will then move on to the next price record and repeat the
    process until a price record with a different date is
    encountered or the end of the price history record list
    is reached.

 4) Access DataLink by executing the Alt+L command from the
    Price History screen. PgDn if necessary to get to the
    DataLink record for the service from which you wish to
    retrieve quotes. Check to be sure that you've install a
    telephone number and password for this service. You
    should also check to confirm that the Price History
    filename and record date are displayed on the lower half
    of the DataLink menu.

 5) Use the DataLink Alt+R command to modify the End Date if
    you wish to retrieve quotes for more than just one date.

119
 6) Execute DataLink Alt+A command. Select quote type #3 for
    single date quotes and quote type #4 for multi-date
    quotes.

 7) For immediate quote retrieval hit <Enter> when prompted
    for an access time. For later access, specify a time,
    then hit <Enter>.

 8) DataLink should automatically log-on, retrieve quotes and
    log-off. Upon returning to the DataLink screen, use the
    Esc key to return to the Price History records. Review
    the quotes for reasonableness. Multi-date quotes will be
    located at the end of the price record list. Execute the
    Price History "sort" function Alt+S to put these in date
    order.


Communication Config. Specifications
───────────────────────────────────────────────────────────
Other communication parameters (other than baud rate,
parity, etc.) are configurable through the DataLink "Cspec"
(Alt+C) command as follows:

 ╔════════════════════════  Communication Parameters  ════════════════════════╗
 ║                                                                            ║
 ║                       A)  Auto Log-On     : On                             ║
 ║                       B)  Max. Link Trys  : 1                              ║
 ║                       C)  Connect Wait    : 25 sec.                        ║
 ║                       D)  Receive Wait ^W : 30 sec.                        ║
 ║                       E)  Pause Delay  ^P : 3 sec.                         ║
 ║                       F)  CTS Check       : Off                            ║
 ║                       G)  DSR Check       : Off                            ║
 ║                       H)  THR Check       : On                             ║
 ║                       I)  Transmit Pacing : 10 m-sec                       ║
 ║                       J)  Auto Dial Port  : 1                              ║
 ║                       K)  Dial Sequence   : AT^PDT<PH>^R                   ║
 ║                       L)  Hangup Seq.     : ^P+++^P ATH^R                  ║
 ║                       M)  Modem Init:     :                                ║
 ║                                                                            ║
 ╠════════════════════════════  Alt + saVe Help  ═════════════════════════════╣
 ║                                                                            ║
 ║                       >                                                    ║
 ║                                                                            ║
 ╚════════════════════════════════════════════════════════════════════════════╝

Communication specification parameters operate as follows:

 Auto Log-On - When set to "On" the "SmartTerminal" command
 automatically executes the dial-up and log-on scripts.
 Setting this parameter to "Off" essentially turns your PC
 into a "Dumb Terminal" requiring you to perform these
 functions manually.

 Max Link Trys - Number of link trys if initial auto-log
 link attempt fails.

 Connect Wait - Approximate time to wait for carrier tone
 following dialing.  This value may have to be increased for
 some access numbers.

120
 Receive Wait - Approximate time to wait to receive charac-
 ter string following ^W in DataLink script.

 Pause Delay - Time to pause for occurance of ^P in DataLink
 script.

 CTS Check - Value of "On" specifies to wait for "Clear To
 Send" signal from modem before transmitting.  In general,
 leave "Off" unless you have an MNP modem running in error
 correcting mode.

 DSR Check - Value of "On" specifies to wait for "Data Set
 Ready" signal from modem before transmitting. In general,
 leave "Off" unless you have an MNP modem running in error
 correcting mode.

 THR Check - Value of "On" specifies to wait for empty
 "Transmit Hold Register" before transmitting.

 Transmit Pacing - Speed with which to transmit to host. If
 pacing is faster than the baud rate, the baud rate controls
 the speed.

 Modem Init - Allows input of modem initiation parameters.
 See your modem manual for available parameters.

The initial settings of these specifications should work on
most systems, however some modems may require the CTS and/or
DSR to be set "On".

121


Appendix A
────────────────────────────────────────────────────────────


PFROI Configurations

PFROI configuration parameters may be accessed by selecting
"C" for Configure on the PFROI main menu. The PFROI config-
uration screen then appears as follows:

 ╔══════════  PFROI1.CFG <-------- Configure --------> PFROI2.CFG  ═══════════╗
 ║                                                                            ║
 ║    A) Color Setups                   P) Fiscal Year   : 12/31/90           ║
 ║    B) Printer Specs.                 Q) Tax Adjust.   : On                 ║
 ║    C) Comm. Parameters               R) Loss Carryover: On                 ║
 ║    D) Set User ID                    S) C.G. Indexing : Off                ║
 ║    E) Work File Path :               T) Distributions : Off                ║
 ║    F) Sys. Mhz       : 8.00          U) Twtd ROI/Beta : Off                ║
 ║    G) Sys. Sound     : On            V) Val. Base     : First              ║
 ║    H) Mono. HiVideo  : LowVid        W) Client Rpts   : TAGDIPS            ║
 ║    I) Block Cursor   : Off           X) Misc. Specs.  :                    ║
 ║    J) Date Feed      : Off           Y) Market Indices                     ║
 ║    K) File Backup    : On                                                  ║
 ║    L) Base Currency  : $                                                   ║
 ║    M) Decimal Type   : .                                                   ║
 ║    N) Amt Decimals   : 2                                                   ║
 ║    O) Date Format    : Mo/Dy/Yr                                            ║
 ║                                                                            ║
 ║                                                                            ║
 ╠════════════════════════════  Alt + saVe Help  ═════════════════════════════╣
 ║                                                                            ║
 ║    >                                                                       ║
 ║                                                                            ║
 ╚════════════════════════════════════════════════════════════════════════════╝

The items on the left apply of this menu are stored in the
file PFROI1.CFG.  These parameters apply to all PFROI
operations, while those on the right may be configured
individually for each portfolio as described in Chapter 3,
"Local Configurations".

The configuration selections on the left operate as follows:


Color Setups

Selecting Color Set-up from the Configuration menu obtains
the following sub-menu which allows you configure the colors
on a CGA, EGA or VGA color display.

Toggle the keys from "A" to "L" until the color scheme suits
your taste.  The foreground selections change the color of
characters while the background selections change the color
surrounding the characters. Users who have CGA display
adaptors but monochrome display monitors should adjust the
settings so as to maximize text contrast.


122
Printer Specifications

The printer specifications menu allows you to set various
output related parameters for up to three printers plus
console output and output to a disk file. Select Printer
Specs. from the configuration menu to get the following
submenu:

 ╔══════════════════════════════ Printer Specs. ══════════════════════════════╗
 ║                                                                            ║
 ║               Device  Cols Lines Top Brk Setup Codes                       ║
 ║               ------  ---- ----- --- --- ------------------------          ║
 ║           1)  LPT1     80    66   0  Off                                   ║
 ║           2)  N/A      80    66   0  Off                                   ║
 ║           3)  N/A      80    66   0  Off                                   ║
 ║           4)  CON      80    28   0  On                                    ║
 ║           5)  Disk     80    66   0                                        ║
 ║                                                                            ║
 ║           A)  Display Type         : EGA/VGA                               ║
 ║           B)  Printer Type         : 9/24 Pin Epson                        ║
 ║           C)  Printer Aspect Ratio : 1.6667                                ║
 ║           D)  Graphics Width (Dots): 960                                   ║
 ║           E)  Graphics Setup Codes :                                       ║
 ║           F)  Graphics IPL Setup   :                                       ║
 ║           G)  IPL Reset Codes      :                                       ║
 ║           H)  Vertical Line Char.  : |                                     ║
 ║                                                                            ║
 ╠═════════════════════════  Alt + Reset saVe Help  ══════════════════════════╣
 ║                                                                            ║
 ║           >                                                                ║
 ║                                                                            ║
 ╚════════════════════════════════════════════════════════════════════════════╝

In the example above, devices #2 and #3 are "N/A" (not
available) to indicate that printer adaptors LPT2 and LPT3
were not detected upon program startup.

Specifications for output devices #1 to #5 are as follows:

 Cols - Maximum number of character columns. If a wide-
        carriage printer is used or compressed print invoked
        by the setup codes (see below) then more than 80
        columns may be entered here. Some reports will print
        additional fields of data if greater than   80
        columns are available.

 Lines- Maximum number of lines per page on output. This
        value is used to determine report page breaks.

 Top  - Specifies page top margin in number of lines.

 Brk  - If set to "On" specifies that output halt at the end
        of a page until a key it hit. This is useful for
        console output or manual paper sheet feed.

 Setup- Setup codes are transmitted to the printer prior to
 Codes  the initiation of any text output. Codes may be
        used to specify left margin, type style and size,
        print density, etc. However, since printer brands
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        are not consistent in their usage of codes, you
        should consult your printer manual for the codes you
        need.  See below for how to enter ASCII setup codes.

Selections A thru G are for printer graphics output.
Graphics may be printed without a graphics display adaptor,
however you must have a graphics capable printer.

 Display Type - This is setting is automatically set upon
 PFROI start-up based upon detection of the type of display
 adaptor installed in your PC. This setting is informational
 and generally should not be changed.

 Printer Type - Toggles between several different printer
 types including 9-pin Epson type dot matrix and HP-II laser
 printer types (use Laser setting for HP Deskjet).  The "IBM
 Char Set" setting produces enhanced underline and header box
 characters, but requires that your printer be set in a mode
 which recognizes the "IBM Graphics Character Set".

 Printer Aspect Ratio - This parameter specifies the ratio
 of the horizontal dots per inch over the vertical dots per
 inch. This ratio is usually fixed for each printer type and
 thus is automatically changed when the Printer Type is toggled.

 Graphics Width - This parameter is used to define the width
 of the graphics print-out in "pixels" (dots) and automatic-
 ally changes when the Printer Type is toggled. Since PFROI
 printer graphics are now memory buffered, this parameter is
 no longer display-type dependent.

 Graphics Setup Codes - Sets printer for bit image graphics
 operation.  The 9-pin Epson setting is 'Esc','L',Alt-
 192,Alt-3.

 Graphics IPL Setup - Sets up printer inch-per-line for
 graphics operation.  The 9 pin Epson default setting is
 'Esc','3',Alt-24.

 IPL Reset Codes - Resets printer inch per line for text
 operation subsequent to graphics. The 9 pin Epson default
 setting is 'Esc','3',Alt-36.

Setup codes may be keyed-in directly as keystrokes (e.g.
Ctrl-O for ASCII 15) or may be entered by depressing the Alt
key while keying in an ASCII value from the keyboard number
keypad. The first entry in the setup codes must have an
ASCII value less than ASCII 32.

Selection "H" allows you to re-define the vertical charac-
ter "|" used in PFROI report headers. Some users who are
using "international" settings on their printer may find
this necessary because the "|" character has been pre-empted
by another character.

The Alt+R command allows you to reset printer configurations
to their original value after they have been temporarily
modified.

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The Alt+V command save the printer specifications to the
PFROI2.CFG file.


Communication Parameters

Selecting Comm. Parameters from the Configuration menu
generates a sub-menu covered in Chapter 9.


User Identification

This selection is non-applicable to shareware.


Work File Path

PFROI utilizes all of the available PC DOS main memory to
hold portfolio and other data file records. This is done to
speed calculations. Although unlikely, if memory does
becomes filled PFROI will create temporary disk files
("&" first letter in file extension) for the data overflow
and will swap data records to and from disk as necessary.

The Work File Path specifies the disk and the directory to
be used for the temporary overflow files. If your files
become so large that overflow does occur, for fastest
operation designate a RAM-Disk as the work file path,
provided your PC has RAM-Disk capability.  For example,
if drive "D" is the RAM-Disk, specify "D:" (without quotes)
in this field.


System MegaHertz

This parameter is no longer used.


System Sound

Activates/deactivates PFROI sound generation.

Monographic HiVideo

Settings toggle between Hi Video, Normal Video and Reverse
Video and color settings.

Block Cursor

Toggles cursor between Block and Underline mode. Use the
block mode for laptop PC's.


Date Feed

When set to "On", this configuration parameter causes the
last previous date to be fed into a date field when a new
record is created.


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File Backup

When set to "On" this configuration parameter causes the
last previous version of the file to be saved as a backup
whenever a date file is saved.  The name of the backup file
is the name of the source file plus a "$" as the first
character in the filename extension. WARNING: Even if this
parameter is set to "On" you should still make regular
backups to floppy disks or tapes to protect yourself in case
your hard disk fails or you inadvertantly delete all files.


Base Currency

This configuration parameter designates the symbol of the
base currency to be used in portfolio and data files in the
currently active sub-directory.


Decimal Type

This configuration parameter specifies the decimal point
notation to be used. It toggles between the "." used in
North American and the "," used in Europe and elsewhere.


Amount Decimals

This configuration parameter specifies the number of decimal
places to display for data entry fields taking currency
amounts.


Date Format

This configuration parameter specifies the calendar date
entry and display format. It toggles between three formats
as follows:

   Mo/Dy/Yr   ( Month/Day/Year )
   Dy-Mo-Yr   ( Day-Month-Year )
   Yr.Mo.Dy   ( Year.Month.Day )

The date separators are used by PFROI to identify the format
being used when a date is entered in a description field.

The "Century Base Year" is the start year for the 100 year
period represented by the year field.  Thus the default
Century Base Year of "1951" means that year inputs of "51"
to "50" represent the years 1951 to 2050.  WARNING: Do not
change the Century Base Year once you start entering data.


Saving Configurations

Once you are through setting your configurations, use the
Alt+V command to save them to disk in a file named
PFROI2.CFG.  The configurations will be reloaded from this
file whenever you start PFROI or switch the currently active
126
directory to the directory containing PFROI2.CFG.

As previously noted, more than one directory may contain a
PFROI2.CFG file and other ".CFG" files, thus allowing
different configurations for different groups of data files.
127


Appendix B
────────────────────────────────────────────────────────────────


PFROI Trouble-Shooting (Common User Mistakes)

────────────────────────────────────────────────────────────────
SYMPTOM : Position records don't include some transactions
or appear to have the wrong position quantity or cost base.

Possible Causes :

1) You failed to re-execute the "Create" (Alt+C) valuation
   command after entering or modifying transactions.
   Portfolio positions are only recomputed by doing an
   "Create" command; they are NOT re-computed with a
   "Review" (Alt+R) command.

2) Transactions are incomplete (missing data). Incomplete
   transactions are excluded from portfolio position
   calculations.  They are furthermore sorted to the bottom
   of the transaction record list, so as to obviously
   identify them as incomplete.

3) The "Base Date" when doing an "Create Valuation" command
   was set AFTER transactions which where inserted or
   modified.  The "Base Date" must be set to a date PRIOR to
   a transaction for that transaction to be picked up by an
   "Create" calculation.

4) You've used the same ticker symbol for more than one
   security causing PFROI to combine the two securities on
   the position screen.  Some people make this error by
   using the same symbol (e.g. "MF") for several different
   mutual funds.

────────────────────────────────────────────────────────────
SYMPTOM : Positions appears to have reversed signs or
incorrect cost bases.

Possible Cause : The quantity or amount signs on some
transactions for affected securitie may be reversed.  This
can occur as a result of the following:

1) You changed transaction codes (e.g. a BUY to a SLL)
   without re-entering quantity or amount. As a result signs
   are reverse of what they should be.

2) You turned the "auto-sign" function off when entering
   transactions.  The "siGn" function at the top of the
   transaction input screen should always be set to "On"
   unless you are deliberately trying to enter a reverse
   sign.



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────────────────────────────────────────────────────────────
SYMPTOM : You are reinvesting in a stock or mutual fund and
its cost basis appears to be increasing although you have
not added any new funds.

Comment : This is not a problem.  Many people have the
mistaken belief that dividend, interest or capital gains
reinvestment should not result in an increase in cost basis.
However, cost bases SHOULD increase when reinvesting.  This
is because the funds one is reinvesting represent funds that
could have been used for some other purpose if they hadn't
been reinvested.  These funds are thus no different than any
other "new" funds that might be added to an investment.
Furthermore, reinvested funds are taxable unless earned in a
tax-sheltered account and thus must be added to cost-bases
to avoid double taxation upon sale of the investment.

─────────────────────────────────────────────────────────────
SYMPTOM : Very large positive or negative ROI result.

Possible Causes:

1) The result may be real if a security experienced a large
   jump in value over a short period of time.  For example,
   a 10% rise in one week generates an annualized ROI of
   about 13700%. For individual securities this situation
   can occur if a security is bought near the end of an ROI
   period or sold shortly after the beginning of an ROI
   period, reducing the effective holding time for the
   security to a few weeks or less. In general, drawing
   conclusions from ROI results over short periods (days or
   weeks) is meaningless.

2) You are trying to compute ROI for a short sale type of
   transaction on an individual security.  There is no
   meaningful ROI for such a transaction because there is no
   amount initially "invested".

3) You are doing an ROI without specifying a start or end
   date for which there is a valuation.  In such case PFROI
   attempts to computed an estimated valuation, but results
   are unpredictable.

───────────────────────────────────────────────────────────
SYMPTOM : Reports won't print.

Possible Causes :

1) You haven't specified "Base" or "Close" dates for which
   the portfolio has existing valuations.



2) Invalid portfolio name.  A portfolio filename must
   consist of a prefix of no more than 8 characters and an
   extension of no more than 3 characters, with no spaces.
   (A "path" may preceed filename). Examples of valid and
   invalid filenames are:

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     Valid   : "B:SMITHSON.WMA"
     Invalid : "B:SMITHSONS.FAMILY"

───────────────────────────────────────────────────────────
SYMPTOM : Valuation graphics are not printing or are
printing garbled output.

Possible Causes:

1) You are trying to print valuation graphics and your
   printer is not set in the "Program" mode.

2) The "Printer Type" setting in the Printer Specifications
   menu (see "Configure" menu) is incorrect for your type
   of printer.

3) The "Graphics Setup" settings in the printer specifica-
   tions (see "Configure" menu) are incorrect for your type
   of printer.


───────────────────────────────────────────────────────────
SYMPTOM : You are not able to reconcile the "U & R Capital
Gains" item on the portfolio ROI report with the realized
capital gains indicated on the "Gains Report" and the
unrealized capital gains indicated on the "Account
Position" report.

Comment:  Careful!  A common mistake in trying to make such
a reconciliation is simply adding the realized gains in the
"Gains Report" to the unrealized "Gains" column displayed
on the "Position" report.  The problem with this approach
is that it fails to take into account the PROPER TIME
PERIOD over which the gains occurred.  The "U & R Gains"
line item on the ROI report is for the time period
specified for the ROI. In contrast, the realized gains for
the "Gains Report" are for the specified fiscal year, and
the unrealized gains derived from the "Position" reports
are gains which have occurred in the period since the
security was acquired.  Neither of these latter two periods
necessarily coincide with the period chosen for the ROI
thus the results should not be directly compared.

To make a meaningful reconciliation for an ROI from "Start
Date" to "End Date", subtract the "Gains" shown on the
"Start Date" Position screen from the gains on the "End
Date" Position screen.   Then add to that all realized
gains which have occurred as a result of security sales
during the ROI period as reported on the "Gains" report.

PFROI version 4.0 now simplifies this process by providing
an "U&R Gains" report which shows you what unrealized and
realized gains have occurred over a specified time period.


───────────────────────────────────────────────────────────
SYMPTOM : A "beep" and the message "Invalid Records, File
Renamed" appears when trying to load a portfolio file or
account file.

130
Cause : You are trying to use an existing file which is an
improper file type.  Rather than let you do this, PFROI
renames the file to "ZZZZZZZZ.XXX".  This feature prevents
you from inadvertantly destroying existing files which may
contain data for other programs.