Brokerage Balances

Your brokerage account holds two types of assets: cash and securities. The app tracks the composition of both to maintain accurate interest deductibility calculations.

Cash Balances

Cash in your brokerage comes from different sources, and the source matters for tracking purposes.

Borrowed Cash

Cash that came from your credit account—money you borrowed with the intention of investing. This is the same money tracked as "uninvested principal" on the credit side.

Increases when:

You transfer borrowed funds to your brokerage (Borrowing To Invest)
Borrowed capital returns from Investment Sale (the borrowed portion of proceeds up to cost)
Borrowed portion of Investment Distribution return of capital

Decreases when:

You record an Investment Purchase (the borrowed portion of the purchase)
You record a Brokerage Cash Withdrawal (the borrowed portion of the withdrawal)
You record a Credit Payment (the portion applied to uninvested principal)

Key point: Borrowed cash is waiting to be invested. While it sits as cash, it's technically still traceable to an investment purpose, but the app classifies it conservatively until you actually purchase securities.

Personal Cash

Cash that's yours—not borrowed. This includes dividends, realized gains, and any deposits of your own money.

Increases when:

You record an Investment Distribution (the income portion plus personal portion of RoC)
You record an Investment Sale at a gain (the gain portion)
You record an Investment Sale (the personal portion of proceeds)
Credit Payment events reduce uninvested principal (borrowed cash converts to personal)

Decreases when:

You record an Investment Purchase (the personal portion of the purchase)
You record a Brokerage Cash Withdrawal (the personal portion of the withdrawal)

Key point: Personal cash has no impact on interest deductibility. Using it to buy securities doesn't increase your deductible debt.

Total Brokerage Cash

Simply the sum of borrowed cash plus personal cash. This is what you'd see as your available cash balance in your actual brokerage account.

Holdings Balances

For each security you hold, the app tracks several attributes.

Units Held

The number of shares you own. This increases when you buy and decreases when you sell. Standard stuff.

Total Cost Base

The total adjusted cost base (ACB) of your position. This is the tax basis used to calculate capital gains when you sell.

Increases when:

You record an Investment Purchase (by the purchase amount including fees)

Decreases when:

You record an Investment Sale (proportionally based on units sold)
You record an Investment Distribution return of capital (by the RoC amount)

Borrowed Cost Base

The portion of your cost base that was funded by borrowed money. This is the key tracking element for interest deductibility.

Increases when:

You record an Investment Purchase with borrowed cash (by the borrowed amount)

Decreases when:

You record an Investment Sale (proportionally)
You record an Investment Distribution return of capital (proportionally—borrowed portion of RoC)
Credit Payment events reduce invested principal (proportionally across all holdings)

Personal Cost Base

The portion funded by your own money—dividends, gains, or deposits. Calculated as Total Cost Base minus Borrowed Cost Base.

Borrowed Percentage

The ratio of borrowed cost to total cost. This determines how proceeds are split when you sell or receive return of capital.

If a position is 70% borrowed, then 70% of any return of capital comes from borrowed funds and returns as borrowed cash.

How Cash and Credit Balances Connect

Several brokerage balances mirror credit account balances:

Brokerage	Credit Account	Relationship
Borrowed Cash	Uninvested Principal	Always equal
Sum of Borrowed Cost Bases	Invested Principal	Always equal

These equalities are maintained automatically. When you buy securities, borrowed cash decreases and invested principal increases by exactly the same amount.

Example: Tracking Through a Purchase

Starting state:

Borrowed Cash: $5,000
Personal Cash: $1,000
No holdings

You buy $4,500 of an ETF, specifying $4,000 from borrowed cash:

After purchase:

Borrowed Cash: $1,000 (was $5,000, used $4,000)
Personal Cash: $500 (was $1,000, used $500)
ETF Holding:
- Units: 100
- Total Cost: $4,500
- Borrowed Cost: $4,000 (88.9%)
- Personal Cost: $500 (11.1%)

On the credit side:

Uninvested Principal decreased from $5,000 to $1,000
Invested Principal increased by $4,000

The $4,000 moved from "waiting to invest" to "invested."

Example: Tracking Through a Sale

Starting state (from above plus some gains):

ETF position worth $6,000 (bought for $4,500)
Borrowed Cost: $4,000
Personal Cost: $500

You sell everything for $6,000:

Calculation:

Proceeds: $6,000
Cost removed: $4,500
Gain: $1,500
Borrowed cost ratio: 88.9%

Proceeds allocation:

Borrowed portion of cost recovery: $4,000 → goes to Borrowed Cash
Personal portion of cost recovery: $500 → goes to Personal Cash
Gain: $1,500 → goes to Personal Cash

After sale:

Borrowed Cash: +$4,000
Personal Cash: +$2,000 ($500 + $1,500 gain)
ETF Holding: eliminated

On the credit side:

Invested Principal decreased by $4,000
Uninvested Principal increased by $4,000

The $4,000 of borrowed capital returned to "waiting to invest" status.

Example: Return of Capital Distribution

Holding state:

200 units of an ETF
Total Cost: $5,000
Borrowed Cost: $3,500 (70%)
Personal Cost: $1,500 (30%)

The ETF pays a distribution of $100, which includes $25 return of capital:

Calculation:

Total distribution: $100
Return of capital: $25
Income portion: $75
Borrowed portion of RoC: $25 × 70% = $17.50
Personal portion of RoC: $25 × 30% = $7.50

After distribution:

Borrowed Cash: +$17.50 (borrowed RoC returned)
Personal Cash: +$82.50 ($75 income + $7.50 personal RoC)
ETF Holding:
- Total Cost: $4,975 (reduced by $25 RoC)
- Borrowed Cost: $3,482.50 (reduced by $17.50)
- Personal Cost: $1,492.50 (reduced by $7.50)

On the credit side:

Invested Principal decreased by $17.50
Uninvested Principal increased by $17.50

Dashboard View

Your dashboard shows brokerage information in two sections:

Cash:

Brokerage Cash: $X,XXX
├── Borrowed: $X,XXX
└── Personal: $X,XXX

Holdings:

Holdings Total Value: $XX,XXX
├── Security A
│   ├── Units: XXX
│   ├── Cost Base: $X,XXX (XX% borrowed)
├── Security B
│   ├── Units: XXX
│   ├── Cost Base: $X,XXX (XX% borrowed)
...

The borrowed percentage for each holding shows how much of that position's interest-generating potential is deductible.

Practical Tips

Watch your borrowed cash. If borrowed cash sits too long, questions may arise about whether you're genuinely investing. Deploy it into securities or return it to your credit account.

Understand RoC accumulation. ETFs with significant return of capital gradually shift your positions from borrowed to personal. Over many years, a position that started 100% borrowed might become 80% or 70% borrowed. This isn't bad—but it does mean slightly less of future interest is deductible.

Reinvest or restructure. When borrowed cash accumulates (from RoC or sales), consider buying more securities to move it back to invested status. Alternatively, use it to pay down your credit and reborrow for fresh investments.