Janus 40 cost basis question

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walkabout
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Janus 40 cost basis question

Post by walkabout »

I have a Janus 40 account in taxable that I’ve had for 25+ years. For at least the last 20+ years the only activity has been shares purchased via dividend and capital gains reinvestment. I haven’t paid a lot of attention to it, because I haven’t been in the market to sell or purchase shares (aside from reinvestment). I might sell some or all of the fund in 2022/2023. I will turn off reinvestment before the end of 2021 so that all gains in the fund will be long term. The cost basis method is currently average cost. I haven’t decided if I want to explore trying to switch to spec id.

Having said all of that, I’m trying to understand the relationship between share purchases (via reinvestment) as shown on year end statements and the cost basis shown in the cost basis activity report.

For example, the 2020 year end statement shows the following:

12/17/2020 4.929 shares; $46.07 NAV; $227.08 total (INCOME REINVEST)
12/17/2020 224.725 shares; $46.07; $10,353.06 total (CAP GAIN REINVEST)

These dollar amounts match the dollar amounts on the 1099-DIV that was issued by Janus for tax year 2020.

Cost basis activity report (on the Janus website) shows the following tax lots:

12/17/2020 (date acquired); 4.929 shares; $157.21 cost basis
12/17/2020 (date acquired); 224.725 shares; $7167.60 cost basis

I would have guessed that the cost basis, as shown in the cast basis activity report would match (in dollars) the dollar amount of the of the capital gains and dividend distributions as reported on the year end statement and on the 1099-DIV. A similar “discrepancy” exists for all of the tax lots from the cost basis activity report (as far back as I have checked). This makes me think I’m not understanding something about the cost basis, at least as shown in the report

In the end, it might not matter that much (if at all), especially if I use the average cost method (since I won’t be acquiring any more new shares). But I would certainly like to be able to make sense of the cost basis report, what it is telling me, and how the values relate to the values shown in the year end statements and 1099-DIVs.

Can anyone shed some light?

Thanks.
plats
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Joined: Mon Dec 31, 2007 9:46 pm

Re: Janus 40 cost basis question

Post by plats »

You bought shares at $46.07 but the average cost basis of those shares is $31.89 when combined with your current holdings.
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walkabout
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Re: Janus 40 cost basis question

Post by walkabout »

Thanks! Seems so obvious now.
dukeblue219
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Re: Janus 40 cost basis question

Post by dukeblue219 »

walkabout wrote: Wed Nov 24, 2021 3:55 pmI will turn off reinvestment before the end of 2021 so that all gains in the fund will be long term.
I'm curious about the logic here. Are you preferring no gain at all to short term capital gains?

Taking some equity risk off the table as you wind down makes sense, but I don't know why you'd specifically be averse to short term gains.
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grabiner
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Re: Janus 40 cost basis question

Post by grabiner »

dukeblue219 wrote: Wed Nov 24, 2021 8:36 pm
walkabout wrote: Wed Nov 24, 2021 3:55 pmI will turn off reinvestment before the end of 2021 so that all gains in the fund will be long term.
I'm curious about the logic here. Are you preferring no gain at all to short term capital gains?

Taking some equity risk off the table as you wind down makes sense, but I don't know why you'd specifically be averse to short term gains.
The logic makes sense if the dividends are being invested somewhere else. The OP is planning to get rid of this fund, and buying more shares will increase the capital gain for getting rid of the fund (assuming the market rises).
Wiki David Grabiner
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