Registering a dividend in the free Junto Portfolio Tracker requires two or three simple steps depending on whether the dividend involves withholding tax.
Let’s say that it’s now 7 months later of our demo portfolio and Div Corporation decides to pay the same dividend as last year: 5 USD per share..
Step 1: Register the Transaction
We register the dividend received in the Transactions tab as follows.
As seen, the dividend paid per share is entered in the cost per unit column.
Note that we enter the full dividend per share that the company pays out and not the amount received in your brokerage account. If your broker withholds tax on the dividend, the amount you receive will be lower. We deal with withholding tax in step 3.
Step 2: Register the Cash Flow
In the Cash Register & Returns tab we register the following.
Step 3: Register Tax Withholding
To account for any withholding of dividend taxes at payout, we register an outgoing cash withdrawal like the following (assuming a tax rate of 20%).
Important: The reason why we do not register a withheld dividend tax as a “negative dividend” is that we in such a case would not get the true total return statistic on our investment incorporating the full dividend payout. We aim to calculate our returns pre-tax.
How to Register a Purchase Transaction
Let’s demonstrate how to correctly enter a purchase of a stock using the fictional company: Company XYZ Inc.
How to Register a Sale Transaction
Let’s say we now wish to sell half of our shares in Euro Ventures GmbH at the current price of 210 EUR.
How to Review Your Portfolio
Let’s say that 2 months have gone by and you wish to take a look at your portfolio status.
How to Register a Stock Split
Company XYZ Inc now decides to do a 2-for-1 stock split so that the amount of shares outstanding doubles and the market price of each share consequently halves.