I use Tradelog to track my trades for accounting and tax purposes. I have used it for probably a decade now and for the most part I have been very happy with it. However, when looking at my trades for last year I found some discrepancies in one of my accounts between the Tradelog data (which can be directly imported from the trade data statements generated by almost all brokers) and the broker’s 1099-B. But unlike most errors, which are rare and large (for example, a broker reporting the same trade twice or accounting for a share exchange in a weird way), I noticed lots of little errors — many trades were off by just a dollar or two. In the grand scheme of things the differences didn’t make a big difference (about $50 total), but I still wanted to fix the errors and understand why they were happening.
I looked at the CSV spreadsheet that I had downloaded from my broker’s website with all the 2018 trades; I had imported my trades to Tradelog directly from this CSV file. The stock prices on all the trades matched so I then looked at the commissions in the CSV file and Tradelog. There I found that on some of my trades, high ECN rebates had been larger than my commissions, leading to a negative commission on the trades. Every single trade with a negative commission was imported into Tradelog as having a positive commission with the same absolute value. So if the commission was ($1.25) then it became $1.25 in Tradelog.
Naturally I thought that there must have been some small error in the import filter from that specific broker. Instead, I was told the following:
TradeLog is limited when it comes to ECN Rebates because the commission has to be negative. If TradeLog were to import the commissions as negative whenever the broker reports them as negative, the resulting data import would be wrong for the vast majority of our users that do not receive rebates. In fact, TradeLog has a special warning to alert the user when inadvertently entering the commission as a negative number as this is in most cases incorrect. This special situation requires that the user make the appropriate adjustments manually:
Editing Multiple Trades
If you have any further questions, please let us know.
This boggles my mind. I had to go back through my data file and edit around 50 different trades to correct the data (at least Tradelog does allow negative commissions although it complains each time you enter one).
I should mention that this problem is not going to affect most traders — you have to trade a lot to get a low enough commission rate that your ECN rebates can be larger than your commissions. But for those of us who do trade that much even small errors can take a lot of time to find and fix.
To fix this Tradelog should allow users the ability to allow the program to import trades with negative commissions (this could be done via a checkbox while keeping the same default behavior). Frequent traders such as myself have enough trouble with brokers often giving incorrect 1099s — we should not have to deal with accounting software that doesn’t import negative numbers.