I write (sell to open) puts on margin for “short premium” on my personal account.

The contract note for an opening transaction lists a number of components:
• contract number
• option symbol
• strike price
• option type
• number of contracts
• price ($) per share
• trade date
• expiry date
• clearing house fee
• brokerage (commission)
• gross premium value ($)
• nett premium value ($)
• initial margin

The initial margin is NOT deducted from the premium received.  It is swept from my cash account.

Most months I’ll average about 60 open positions that I’ll hold to expiry or assignment.

It has become quite hectic with adjustments for dividends, share splits, partial assignments and other events.

My Excel spreadsheet, which replaced my Calc spreadsheet, has now also grown too large to manage.

I am hoping that GnuCash will help me track my positions as my portfolio expands across other brokers.

So, following the advice for How to record a written put option in double-entry accounting?   I have created Liabilities:Open Positions.  But this is where I become lost.

I also need to deal with 1 of 2 possible outcomes: expiry or liquidation.

The expiry notice lists the basics of the contract note including the trade value and the amount of the margin returned to my cash account.  These only happen at expiry.

The liquidation notices also states the clearing house fee for assignment.  These can happen at anytime.

This GnuCash noob needs plently of hand holding...

  • 1
    Questions about accounting are off-topic unless they relate directly to personal finance or investing from an individual's perspective. I believe this question falls into the 'investing from an individual's perspective' bit. Nov 26 '15 at 13:20

You don't. No one uses vanilla double entry accounting software for "Held-For-Trading Security".

Your broker or trading software is responsible for providing month-end statement of changes.

You use "Mark To Market" valuation at the end of each month.

For example, if your cash position is -$5000 and stock position is +$10000, all you do is write-up/down the account value to $5000.

There should be no sub-accounts for your "Investment" account in GNUCash.

So at the end of the month, there would be the following entries:

  • Deposit
  • Withdrawal
  • Market Data Fees for the month
  • Commission for the month
  • Mark to Market Profit/Loss for the month

Thanks for your reply.

I’m not familiar with the term “Held-For-Trading Security”.

My securities are generally held as collateral against my shorts.

To clarify, I am just trying to track the “money in” and “money out” entries in my account for the shorts I write.

The transaction is relatively straight forward, except there is a ton of information attached!

In simple terms, for the ticker CSR and short contract CSRUQ8, the relevant entries look something like this:

29Jun15 naked short put CSRUQ8   1,000.00+
29Jun15 brokerage                   40.00-
29Jun15 contract fee                10.00-
29Jun15 margin call                 50.00-
30Jun15 transfer to savings        900.00-

29Jul15 contract adjustment          3.00-
30Jul15 transfer from savings        3.00+

28Sep15 assignment fee               5.00-
28Sep15 margin return               50.00+
29Sep15 purchase CSR shares     25,000.00-
29Sep15 brokerage                  100.00-
30Sep15 transfer from savings   25,055.00+

There are no entries for expiries.

I need to ensure that funds are available for future margin calls and assignments.

The sale side using covered calls is as involved.

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