ASX CFDs or Short Sell functionality

Hi, have you added ASX CFD's or Short Sell functionality to Sharesight yet?
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  • Hi Letitia - No not yet, we will certainly consider this however it is not on our list of immediate priorities at present.

    I have changed you topic from a 'question' to an 'idea' so that we can keep you updated on this and also gauge the demand for this functionality.
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  • Great idea. I'm interested to add short positions from NYSE, Nasdaq. Thanks.
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  • I’m frustrated
    I can't use this service unless I can incorporate shorts.
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  • 1
    Could you please provide an update on this feature request? Is it in progress and likely to be included soon, or still not on the roadmap?

    Like Michael, this is a threshold issue for me too. You seem to be targeting sophisticated investors and this would seem to be a common requirement.
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  • This reply was created from a merged topic originally titled
    openning another account.


    can I use this for cfd trading?
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  • Hi Marilyn,

    While we support their underlying shares, we don't support CFDs at this stage. Given our connection with CMC, this is certainly something we're considering. As you can probably appreciate, getting the data for CFDs is the major hurdle. We know that we have an active CFD trader population, so we're keen to come up with a solution eventually.

    Regarding asset classes other than shares and ETFs, we'll definitely be adding managed funds in the near future (these are already up and running on an internal testing version of Sharesight), and are looking closely at supporting options (ETOs) as well.

    Cheers,

    Doug
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  • Hi Doug. Could you please also provide an update on whether short selling functionality is on the roadmap? Thanks
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  • Hi Lachlan,

    Short selling functionality is not on our official product development roadmap, though it has come up from time to time. What I need to ascertain is whether or not we could facilitate short selling with the data we having coming into Sharesight at present. If we can make a product adjustment on our end to handle shorts, then the likelihood that we add the functionality is much greater than the scenario in which we need to purchase additional data. The one stumbling block that comes to mind is the fact that currently, we provide end of day pricing data and not intra-day.

    In terms of asset classes to be added, anything listed is on our to do list, with other major non-listed asset classes (funds, cash products) in the pipeline as well. Shorts might require a level of investor-specificity that's difficult for us to handle, but let me check with the Product team and will post a reply here.

    Cheers,

    Doug
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  • I would like to see short selling raised up the priority list please - it is an important part of trading.

    If other asset classes are added, short selling will probably become more necessary.
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  • Another for short selling and US Equity options before I can move from spreadsheets.

    Short selling does not require a change to your data feeds but does impact tax reporting and could impact your lot allocation process.
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  • Hi Allan,

    I note your feedback, and thanks for sending it through. We understand that experienced trades employ short strategies. Just curious, how would you change Sharesight to handled shorts? In other words, what fields, functionality, and reports would you need to see added?

    Cheers,

    Doug
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  • 3
    It would not require significant change to add shorts from a simplistic point of view it just means you sell first and therefore hold negative units which at some time you would need to buy back.

    Main areas of impact would be
    1. The lot allocation process would need to be checked to ensure it does not have checks that prevent you selling more than you own.

    2. Holding reports, its probably best to have a separate section for shorts this makes it easier to keep the calculations of the gains loss the same when you multiple prices by negative units but you make gains when price fall rather than rise.

    3. Performance calculations depending on the methodology used need to ensure short holdings are not netted against long when determining investment base or you end up will silly calculations e.g. if long $50 and short $50 gains and losses are against a base of $100 not 0.

    4. Taxes NZ FIF is not impacted much provided opening & closing balances don't net long/short positions.

    5. Australian taxes should also not have significant changes but due to Capital Gains Taxes both short term & long Term plus sell lot strategies (FIFO, LIFO, Min Gain, Max Gain, Specific select) there is a lot more testing to ensure nothing is impacted and would depend a little on the data structure if its been built to always assume you start with a positive holding which is progressively sold rather than negative that is progressively bought. Cross over point also needs e.g. buy 50 units then sell 100 units on a fifo basis would match the first 50 to the purchase and then need to create a negative lot that will require further purchases.

    6. Dividends need to negative as you need to pay the dividends but tax components would not normally need to be recorded.

    7. Interest would normally be paid as you have effectively borrowed but as you don't currently have a cashbook can be handled the same as you recommend for other cash items. This should feed into tax and performance.

    As my personal holdings are from a NZ point of view shorts are much easier to implement under FIF at least when returns are greater than the 5% threshold compared to the more complex AU rules.
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  • Good stuff Allan, thanks for taking the time to post. Point 5 is especially interesting. We will need to take a careful look at this. All items to be considered with a potential shorts project.

    Cheers,

    Doug
    • I am new to sharesight, but not new to short selling and derivatives

      Accounting for Short Selling a stock (or an option or a Bond) is different from accounting for shorting a CFD/Future

      Most HF/Derivative accounting packages would would break the lots into BO (Buy Open) or SH (for Sell Holdings or SC sell close) + SS (Short Sell or SO for Sell Open) and BC (Buy Close)

      The same rules can apply FIFO,LIFO,Minimum Gain, Maximum Gain, the algo flips around so you do use the Maximum Gain Algorithm to calculate a minimum Gain on a Short Sale

      The accounting is the same as a long only portfolio, however all cashflows (including dividends, rights issues, share splits) are reversed and the market value of a short sale sits as a liability on balance sheet. By the way the cash from the short sale sits as an asset on BS, yes its that simple!

      So if your short a stock and the company announces a rights issue you are short the rights, assuming the lender exercises their rights. But lets face it if the lender is smart enough to earn stock lending fees on their portfolio they are smart enough to exercise efficiently.

      In Australia, there is a concept of onshore borrowing and offshore borrowing of stock, onshore borrowing is where you pay the full cash amount (ie div + franking credits) in lieu of the lender losing franking credits of the stock that you are short,

      Offshore borrowing is where the lender has no use for the franking and you just pay him the cash dividend (no franking credits)

      Accounting for shorting a CFD/Future is slightly different in that the market value of the contract sits as either an Asset, (if in the money) or liability (if out of the money), however typically most people tend to use some sort of FIFO because the contract periods are so short, and therefore the ability to defer taxable gains to the next financial year is greatly reduced - but not eliminated.

      Im sure its not hard to set up a second portfolio and pass the negative market values and negative capital gains to Xero.

      Looking at Sharesight (for the first time) I like that you have thought about minimising CGT in super as being different from minimising gains, thinking about it short term CGT versus long term CGT you could create an option adjusted (10% versus 15%) minimal CGT and market the algo to institutional super. IE at what point is better to sell another lot at a loss than to use it to offset a ST Capital Gain, if that lot is close to being a long term gain.? My superfund will probably never be big enough for me to investigate this phenomena, could be a good thesis question for someone doing higher level finance.

      Regards
      G

      Example - Two Men say their Jesus one of them must be wrong

      Long Only Trading BHP (Minimise Gain)
      Date Buy/Sell Stock Units Share Price

      day 1 BO BHP 5000 40 200,000.00
      day 2 BO BHP 7000 30 210,000.00
      day 3 BO BHP 1666 20 33,320.00

      and you want to sell 7500 BHP @30

      day 1 BO BHP 5000 40 200,000.00
      day 2 BO BHP 7000 30 210,000.00
      day 3 BO BHP 1666 20 33,320.00
      day 4 SH BHP 5000 30 -150000 -50,000.00
      day 4 SH BHP 2500 30 -75000 0.00

      open lots are 6166 27.30 168,320.00 Realised Loss -50,000.00

      Short Seller Trading BHP (Minimise Gain)
      Date Buy/Sell Stock Units Share Price

      day 1 SS BHP 5000 40 -200,000.00
      day 2 SS BHP 7000 30 -210,000.00
      day 3 SS BHP 1666 20 -33,320.00

      and you want to buy 7500 BHP @30

      day 1 SS BHP 5000 40 -200,000.00
      day 2 SS BHP 7000 30 -210,000.00
      day 3 SS BHP 1666 20 -33,320.00
      day 4 BC BHP 5834 30 175020 0.00
      day 4 BC BHP 1666 30 49980 -16,660.00
      open lots are 6166 38.11 -234,980.00 Realised Loss -16,660.00
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  • I’m frustrated
    I can't use this service unless I can incorporate shorts.
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  • I’m frustrated
    2
    Hi Doug

    Can you please provide an update on where you got to with short selling functionality? This is really important to me, and I suspect will impact a lot of sophisticated investors using your product.

    Even if it can just be implemented in a simplistic way would be helpful. For those that want short selling enabled we could just check the tax calculations ourselves. All I think is needed is to remove the restrictions on negative shares. Alan raises a number of points above if it is to be done properly which I agree with.

    An update on status and (hopefully) timing would be appreciated.

    Thanks
    Lachlan
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  • I’m frustrated
    I can't use this service without CFDs - its not cost effective as i would need a second solution to manage those trades
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  • This reply was created from a merged topic originally titled Tracking shorted stocks?.

    Can Sharesight be modified to cope with negative quantities, i.e. the tracking of shorted stocks?
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  • This reply was created from a merged topic originally titled Short sell support.

    Currently short sell is not allowed / supported in Sharesight. I think it should be supported. It may be better to provide user with option to allow short selling in their portfolio for a particular stock or for the whole portfolio. It is a normal strategy and hence should be supported by the software if it plans to capture major market share. I don't think it would be too difficult to implement it anyway.
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  • Yep - I'll add my name to the list for this - holding short positions is definitely something I need. As mentioned above, this shouldn't be too difficult to implement in a 'simplistic' way (i.e. no guarantees around tax reports etc. of short held positions).

    Not sure if I'll be able to go ahead after trial period without short positions.

    Any update on timeline for this...if at all?
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  • Hi Anthony,

    Unfortunately I can't give an update on time-frames for this feature.

    However, we are steadily working through our list of client requested ideas based on the number of 'me-too's.

    At this stage there are 8 ideas tickets that are higher ranking that we are likely to prioritize above this feature.

    Apologies for not being able to deliver better news at this point.

    Regards
    Ben
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  • Has anyone come up with any semi-usable workarounds to deal with short selling?

    I'm struggling for any ideas for how to make it work under the current limitations outside of just doing it all yourself somewhere else in a spreadsheet. Once you get to that point though you might as well give up altogether and just do everything yourself.
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  • Hi Ben

    Thanks for the feedback. I understand a prioritisation system, and clearly holding short positions is lower on the list than other requests...however has implementation difficulty been considered? If the only thing holding back the implementation of short positions is to simply allow sells to precede buys and allow negative quantities to be held, then you have a quick win.

    All dividend, gain, value etc. calculations can remain the same - they're simply multiplying by a negative quantity rather than a positive one.

    I know I'm simplifying things to a degree - but in simple terms, allowing short/negative positions is achieved by 'removing' a restriction in the software which currently inhibits this.

    I signed up with Sharesight and paid my money all the same - but the lack of short positions is definitely frustrating.

    As an aside, could you please direct us to an area that lists the ideas tickets in order of implementation?

    Regards
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  • Hi Anthony,

    As part of the feature we will need to re-look at our performance calculation's. As it stands now they are unlikely to work correctly once we throw in negative quantities. So we do think it will be more involved than just removing the existing restriction in our software.

    In terms of ranking the forum ideas, we place a lot of weight on the number of likes, or 'me too's. To see the ranking of all ideas by popularity, click 'Topic's and then 'Ideas'. You should then see all ideas ranked by number of likes.

    Regards
    Ben
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  • Hi Ben,

    Thanks for responding on this topic.

    I understand there may be some challenges in implementing shorts on the performance side. Could you consider just supporting shorts for the tax side of things as an interim solution?

    I'm not sure about others but I need Sharesight for the tax compliance side as it ties nicely for my accountant.

    This would at least be a step forward, especially if performance is the main hurdle as you suggest above.

    Steve
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  • Hi Steve,

    Thanks for the suggestion above. I'll take that idea away and discuss with the team. There may well be a way to split up the development effort along the lines you've outlined.

    When we get to this feature I'll make sure to post any updates on this forum topic!

    Cheers
    Ben
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  • I'm keen on this. I short sell US stocks and options (I write options, or 'sell to open' - such as writing covered calls) via optionsXpress and Interactive Brokers. I'm happy to manually enter these or use CSV import feature (works ok for me with IB using their flex queries reports for me), but can't do so simply because you can't start with a -ve 'buy' transaction amount. Will be very happy when this becomes available - thanks for considering it :)
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  • Also keen on being able to short sell. Can't use the software without it.
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  • I will upgrade in order to support the team and the development of new features. Although Short Selling is not a large portion of my portolio, it is still a key part of my overall strategy and will increase over time.

    Please add Short Selling !! Keep up the great work
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  • This reply was created from a merged topic originally titled CMC CFD - supported?.

    Hi, I'm looking into Sharesight but really only interested if it supports the automatic connection to CMC CFD Trading (https://au.cmctracker.com/Main.html). I can see it supports CMC Stocks but not CFDs. Please advise?
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