Summary: Many people miss out on the benefits of directly investing in shares (and other exchange-traded products) or have to overpay someone else to do it for them, purely because it can be complicated and overwhelming to do the tax correctly, keep the records, track performance, make informed investing decisions, and maintain a suitable portfolio.

I've previously recommended using at least the Sharesight free plan in my post: Start applying the best tips for investing in shares, And I've provided the essential details on how to use Sharesight to easily complete your Dividend and Capital Gains tax information in this post: Start using the cheapest and most efficient ways to manage tax on shares

In this post I will use the paid Sharesight Investor plan to discuss how to get the most out of Sharesight's various features. I will also compare the various plans: Free, Starter, Investor and Expert and provide guidance to decide whether the added features are worthwhile.

Related Posts:
> See the shares category of this blog.
> Start using the cheapest and most efficient ways to manage tax on shares


Details:

1. What main advantage does Sharesight have over using your online broker's info, spreadsheets, Google/Yahoo Finance or a financial advisor?

The core problems Sharesight solves are nicely summarised by the founders who built Sharesight firstly for themselves:

"If you are a self-directed investor who does not use Sharesight I’m sure you find that: 

- Record keeping for accounting and tax purposes is a nightmare and;
- It is virtually impossible to calculate the true performance of each share and your total portfolio over the time period of your choice. Without this knowledge it is much harder make sound investment decisions and become a confident share market investor. 

Any professional help you get with these problems is likely to be expensive and fall short of what you need. And the fees you pay will impact adversely on your returns."
> These two reasons are why I founded Sharesight

Google is shutting down the portfolio feature within Google Finance in Nov 2017. Yahoo Finance is the other popular alternative. The below comparison of features is very helpful in seeing the extra features of Sharesight versus most web-based portfolio tools.

See also:
> 4 ways Sharesight is better than Google Finance
> Yahoo Finance vs Sharesight -- comparing portfolio trackers
> Import your Google Finance portfolio into Sharesight

You can still use your own Google Sheets spreadsheet and link it to Google Finance share price data. However, you'd need to find or build all desired formulas and reports.

Note that Sharesight doesn't have full coverage of all international markets so you may need to use a spreadsheet and Google Finance or Yahoo Finance share price data for uncommon markets.

See:
> Exchanges and data providers on Yahoo Finance
> Sharesight - Supported Stock Exchanges, Mutual Funds, Managed Funds, ETFs


2. Sharesight's performance figures adjust for transaction costs, currency changes, dividends (inc DRPs) and holding periods. It also makes comparison and benchmarking easier

"So, don’t expect reliable performance reporting from your broker. If you really want to know what your true performance is, across asset classes, accounting for dividends, DRPs, transaction costs and currency movements, Sharesight is the answer. It will even provide reliable tax statements for your accountant.

Best of all, with benchmarking tools and editable charts and graphs, it’s easy to accurately compare and visualise your performance against the index of your choice. With most online brokers you’ll never know whether you’re beating the market or not. With Sharesight you always do."
> How your broker’s performance numbers mislead you

Key Notes:
- Sharesight performance returns are annualised but assume 12 months or more, which means that displayed performance over periods of less than 12 months is not accurate. E.g. A 1% return made in 1 day will show up as a 1% return for the year not a 365% return.

See also:
> Performance calculation methodology
> Interpreting portfolio performance: 3 reasons why your return figures seem incorrect (but actually aren’t)
> How to track a dividend reinvestment plan


3. What are the differences between the Sharesight plans and which is most worthwhile?

The main difference in features available and limitations are summarised here:
> Sharesight - Pricing

You can try out any paid plan for 30 days before billing starts and if you pay annually you save 1 month's fees.


- The Free plan now has a hard limit of 10 current holdings but this does not affect import of previously sold shares. Many reports are still effective with only 10 holdings given limited timeframe (e.g. 1 year) and the fact that not all shares will appear on them (e.g Dividends, Realised CGT). If your budget is tight, remember you can pay by the month and upgrade only for the month you do your tax.

- The Starter plan is best if you don't need the full functionality of Investor (or a limited budget) but have more than 10 but less than 20 holdings.

- If you have significant amounts invested or over 20 holdings then Investor is most worthwhile as you can take full advantage of reporting and tracking without holding limitations. Being able to readily access all prior trading history is useful, as is having a couple more portfolios to add shares you wish to track separately from your holdings. The Unrealised CGT and Future Income reports are also worthwhile.

- The Expert plan doesn't provide many features beyond Investor apart from priority support.

- In all plans, price data is 20 min delayed for Australia and New Zealand stocks (except low liquidity stocks as the live data comes from Chi-X where the stock may not trade). It is end of day for all exceptions and all other markets.


4. About Sharesight reports and how to use them effectively

Most common queries are answered in the Sharesight guidance below:

> Running Reports

The key reports are:

Tax Reports (ATO rules)
> Taxable Income Report
> Capital Gains Tax Report
> Unrealised CGT Report

Performance Reports
> Diversity Report
> Future Income Report
> Performance Report
> Sold Securities Report
> Contribution Analysis Report

Capital Gains Tax Report

- The Sale Allocation Method default setting is "first in, first out" but this isn't always optimal. You may need to change the sale allocation method for all shares or some shares depending on what you are trying to achieve in the current financial year and with regard to future potential CGT savings.

"First in, first out – Sharesight assumes that you sell your longest held shares first.

First in, last out – Sharesight assumes that you sell your most recently purchased shares first.

Minimise capital gain – Sharesight assumes that you sell shares with the highest purchase price first.

Maximise capital gain – Sharesight assumes that you sell shares with the lowest purchase price first.

Minimise CGT – Sharesight assumes that you sell shares that will result in the lowest capital gains tax first. This method is more sophisticated than the ‘Minimise capital gain’ method because it takes into account the Australian CGT discounting rules."
> Capital Gains Tax Report

A key change worth considering is whether you are still in the process of holding certain share parcels for 12 months to obtain the 50% CGT discount. If so, then if you sell part of the holding you may wish to change from "first in, first out" to "last in, first out" for that share. Sharesight can be set to "minimise CGT" but it only works off shares that are already held for more than 12 months, it doesn't know about any you intend to hold for over 12 months.

Note that you will likely have already calculated CGT and submitted tax returns for prior financial years before you start using Sharesight. If still holding parcels in shares for which you may not have optimised CGT in prior financial years, it is possible to go back and fix up and then submit an updated tax return. However, unless there is a major financial benefit I consider this not worth the hassle.

Instead, simply lock the prior financial years according to the sale allocation method used for prior tax returns (typically first in, first out). Then for all future financial years any changes you make to the sale allocation method for specific shares can apply only to the relevant financial year.

In my case, on the CGT report I changed the report period from my first trade date (Aug 2015) to the most recent financial year I've submitted a tax return for (June 30 2016). I then clicked the "Lock between <date period> button" to lock these as all "first in, first out".

Now I can trial variations and optimise my current 2017-18 financial year sale allocation method and it will only apply to the current financial year.


Note that changing the default sale allocation method only applies to future sales not past ones. So if you want to change past ones you can't do it in bulk, you need to do so manually.


10. Features not yet in Sharesight and how to work around them

a. Not all international equity markets are available to add as holdings

b. The delay on price data varies between markets. For some it is end of day. For some low liquidity ASX and NZX stocks the price data isn't available 20 min delayed as it is sourced from Chi-X where the stock may not have traded.

c. You can't transfer holdings from one portfolio to another yourself, but you can email Sharesight to ask them to do it.


Further Info:

Affluence Funds Management
> Sharesight review