- My Forums
- Tiger Rant
- LSU Recruiting
- SEC Rant
- Saints Talk
- Pelicans Talk
- More Sports Board
- Fantasy Sports
- Golf Board
- Soccer Board
- O-T Lounge
- Tech Board
- Home/Garden Board
- Outdoor Board
- Health/Fitness Board
- Movie/TV Board
- Book Board
- Music Board
- Political Talk
- Money Talk
- Fark Board
- Gaming Board
- Travel Board
- Food/Drink Board
- Ticket Exchange
- TD Help Board
Customize My Forums- View All Forums
- Show Left Links
- Topic Sort Options
- Trending Topics
- Recent Topics
- Active Topics
Started By
Message
Vanguard ETFs
Posted on 3/13/14 at 12:40 pm
Posted on 3/13/14 at 12:40 pm
Looking to get into some ETFs that I can actively play with as opposed to my Mutual Funds I have just sitting with them...
Doing some reading on them and how they have lower fees and no commissions.
So the question is, where are the "fees" assessed?
TIA
Doing some reading on them and how they have lower fees and no commissions.
So the question is, where are the "fees" assessed?
TIA
4
Posted on 3/13/14 at 1:36 pm to Lsut81
I think Schwab has a larger selection of commission free ETFs.
Posted on 3/13/14 at 1:56 pm to white perch
quote:
I think Schwab has a larger selection of commission free ETFs.
I've already got everything through Vanguard and its so easy to do things with them.
But I guess my question would apply to Schwab too. Where do they take the fees out? If there are no commissions, then what do they base their "Lowest Fees" off of???
Posted on 3/13/14 at 2:19 pm to Lsut81
Low expense ratios of the Vanguard ETFs. There may be some one off ETFs at Schwab and Fidelity that are slightly cheaper, but as a whole Vanguard likely has the lowest ERs. iShares will have a few, too, like .18% of IEMG.
Posted on 3/13/14 at 3:42 pm to tirebiter
quote:
Low expense ratios of the Vanguard ETFs. There may be some one off ETFs at Schwab and Fidelity that are slightly cheaper, but as a whole Vanguard likely has the lowest ERs. iShares will have a few, too, like .18% of IEMG.
I guess my question is.. And its a novice question. The way I understand it, ETFs act like Stocks in regards to buying/selling and Funds in regards to diversity.
With Stocks: Money for brokerage is made on transaction fees
With Mutuals: Money is made on funds sitting there and them charging expense ratios
So with ETFs, if Im not charged a fee to buy, I sit on the ETF for 5hrs and dump it, where do they have the chance to charge me?
So confused
Posted on 3/13/14 at 3:49 pm to Lsut81
The manager charges the etf a fee for management, and there are other expense charges. It's not a commission, it impact the etf's net asset value, or net present value. So if their expense ratio is .18 like someone mentioned above, they pay this for expenses out of investors monies.
You mention an important point, it trades like a stock, and many times trades at a discount (or premium) to it's net asset value. Mutual funds settle exactly at their net asset value.
You mention an important point, it trades like a stock, and many times trades at a discount (or premium) to it's net asset value. Mutual funds settle exactly at their net asset value.
This post was edited on 3/13/14 at 3:50 pm
Posted on 3/13/14 at 3:51 pm to Iowa Golfer
quote:
So if their expense ratio is .18 like someone mentioned above, they pay this for expenses out of investors monies.
So if I buy ETF X at 9am tomorrow and turn around and sell it at 3pm tomorrow. Vanguard is going to charge me .17 or whatever the expense ratio is off of the sale?
Posted on 3/13/14 at 3:51 pm to Lsut81
If you're with Vanguard, I just received an email stating they are having a live webinar at 1:00 Eastern tomorrow.
Topic ETF's Seperating Fact from Fiction.
Check it out.
Topic ETF's Seperating Fact from Fiction.
Check it out.
Posted on 3/13/14 at 3:55 pm to Lsut81
Well, knowing VBS fairly well, look at the brokerage agreement and see if it has a section or clause that discusses frequent trading. If so VBS may limit your Vanguard ETF trades or have the right to start charging you if it sees fit.
Extracted:
1 If you buy and sell the same Vanguard ETF in a Vanguard Brokerage account more than 25 times in a 12-month period, you may be restricted from purchasing that Vanguard ETF through your Vanguard Brokerage account for 60 days.
2 A $20 account service fee is charged annually. The fee is waived for Voyager, Voyager Select, and Flagship clients, as well as for any client who elects to receive statements and other important information electronically.
3 The reduced commission or commission-free transactions will apply to the first 25 transactions in each calendar year to any combination of stocks and non-Vanguard ETFs. The number of these transactions is limited to 25 per client, as identified by the primary Social Security number on the account. Vanguard Brokerage reserves the right to end these offers at any time.
I am Flagship and get 25 stock trades free, then $2 thereafter. I have never used the 25 free. I get 100 free trades per year @ Wells and have never used more than 15. If someone really wants to be a trader per se, I believe they would be better served at a brokerage that provides much better user interface, analytics, order levels/stacking, graphics/charting, etc.
This might give you a better idea of what I am saying:
LINK
Extracted:
1 If you buy and sell the same Vanguard ETF in a Vanguard Brokerage account more than 25 times in a 12-month period, you may be restricted from purchasing that Vanguard ETF through your Vanguard Brokerage account for 60 days.
2 A $20 account service fee is charged annually. The fee is waived for Voyager, Voyager Select, and Flagship clients, as well as for any client who elects to receive statements and other important information electronically.
3 The reduced commission or commission-free transactions will apply to the first 25 transactions in each calendar year to any combination of stocks and non-Vanguard ETFs. The number of these transactions is limited to 25 per client, as identified by the primary Social Security number on the account. Vanguard Brokerage reserves the right to end these offers at any time.
I am Flagship and get 25 stock trades free, then $2 thereafter. I have never used the 25 free. I get 100 free trades per year @ Wells and have never used more than 15. If someone really wants to be a trader per se, I believe they would be better served at a brokerage that provides much better user interface, analytics, order levels/stacking, graphics/charting, etc.
This might give you a better idea of what I am saying:
LINK
Posted on 3/13/14 at 3:56 pm to Lsut81
many etfs charge a penalty if you hold less than 30 days, although not sure how they do that.
I generally go with ishares, schwab or vanguard for my etf. I like to have quite a few different ETFs that I invest in. ishares has some nice industry/niche ETFs, where as I found vanguards not quite as compelling.
I generally go with ishares, schwab or vanguard for my etf. I like to have quite a few different ETFs that I invest in. ishares has some nice industry/niche ETFs, where as I found vanguards not quite as compelling.
Posted on 3/13/14 at 4:02 pm to Lsut81
quote:
So if I buy ETF X at 9am tomorrow and turn around and sell it at 3pm tomorrow. Vanguard is going to charge me .17 or whatever the expense ratio is off of the sale?
No, that is the annualized cost if you held it for a year. There are also bid/ask spreads that may cost you $ when entering/exiting the trade, and there could be quite a difference in the NAV value of the ETF vs the market price at the time you buy or sell. I will say this, if you buy a security and it is volatile or illiquid due to small trading volume, or there is a market disruption, you may find yourself stuck on the wrong end. Leveraged ETF come to mind, as well as numerous thinly traded ETFs with small daily/weekly trade volumes. Most Vanguard ETFs have significant trade volumes, so not a lot of worry on that but still possible.
ETA - that is another issue with VBS, it doesn't provide the detail you would want if you branched out into trading other securities/instruments.
This post was edited on 3/13/14 at 4:04 pm
Posted on 3/13/14 at 4:05 pm to Hawkeye95
So if I buy ETF X at 9am tomorrow and turn around and sell it at 3pm tomorrow. Vanguard is going to charge me .17 or whatever the expense ratio is off of the sale?
No. Your sell price as well as your buy price would already have this factored in. Possibly. One big pool of monies, and expenses come out of the pool. The broker gets paid a percentage of assets in an etf is how they get paid I believe.
The pool is reduced by the expenses, but the share price is many times independent of this. You buy 100 shares for 10, it costs you 1000, you sell 100 shares at 11, you get 1100.
There are frequent trader and short term charges if you hold it less than X days, or are in and out of it too much on many of these.
No. Your sell price as well as your buy price would already have this factored in. Possibly. One big pool of monies, and expenses come out of the pool. The broker gets paid a percentage of assets in an etf is how they get paid I believe.
The pool is reduced by the expenses, but the share price is many times independent of this. You buy 100 shares for 10, it costs you 1000, you sell 100 shares at 11, you get 1100.
There are frequent trader and short term charges if you hold it less than X days, or are in and out of it too much on many of these.
Posted on 3/13/14 at 5:14 pm to Lsut81
In my experience, the trading fees on an ETF are done two ways in my brokerage account.
I'm with Charles Schwab, so if I buy one of their ETFs, it is commission free to buy and sell, as long as I hold it more than 30 days I believe.
If I buy a Vanguard ETF, it is $8.95 for the commission from Charles Schwab to buy and sell, but Vanguard does not charge any fees other than the expense ratios annually. I can buy or sell VOOV 10 times in one day, and I'll pay $89.50 in commissions. Other than the fact that I would likely be considered a pattern day-trader, that is the only cost associated with buying ETFs for me.
I'm with Charles Schwab, so if I buy one of their ETFs, it is commission free to buy and sell, as long as I hold it more than 30 days I believe.
If I buy a Vanguard ETF, it is $8.95 for the commission from Charles Schwab to buy and sell, but Vanguard does not charge any fees other than the expense ratios annually. I can buy or sell VOOV 10 times in one day, and I'll pay $89.50 in commissions. Other than the fact that I would likely be considered a pattern day-trader, that is the only cost associated with buying ETFs for me.
Posted on 3/14/14 at 12:20 am to slackster
Slack, that is what I understand from Scottrade. Their fee is $17 to buy the ETF, and $17 when I sell, but no fee from VG (or any ETF).
If this is incorrect, someone enlighten me.
If this is incorrect, someone enlighten me.
Posted on 3/14/14 at 1:11 am to Lsut81
quote:
So the question is, where are the "fees" assessed?
In your returns.
It is invisible essentially.
Posted on 3/14/14 at 6:32 am to Iowa Golfer
quote:
Your sell price as well as your buy price would already have this factored in
Ok, now that makes sense.
So if I see $158/share, the "Real" cost of that ETF is like $156 and the extra $2 are the fees added in.
Posted on 3/14/14 at 8:55 am to Lsut81
^^^ I think this is incorrect.
When you ask about a "fee", it is the same on an ETF as it is on a C-share mutual fund. The fee is the expenses that are usually taken out of the NAV monthly or quarterly or even daily.
The "commission" you're charged for buying or selling the fund depends on the broker and fund family. In most cases, the commission for an ETF is no different than buying shares of Wal-Mart stock.
When you ask about a "fee", it is the same on an ETF as it is on a C-share mutual fund. The fee is the expenses that are usually taken out of the NAV monthly or quarterly or even daily.
The "commission" you're charged for buying or selling the fund depends on the broker and fund family. In most cases, the commission for an ETF is no different than buying shares of Wal-Mart stock.
Posted on 3/14/14 at 9:11 am to slackster
quote:
When you ask about a "fee", it is the same on an ETF as it is on a C-share mutual fund. The fee is the expenses that are usually taken out of the NAV monthly or quarterly or even daily.
The "commission" you're charged for buying or selling the fund depends on the broker and fund family. In most cases, the commission for an ETF is no different than buying shares of Wal-Mart stock.
Yeah, I didn't even consider that they would factor in the fee to the share price. Wasn't thinking logically.
Posted on 3/14/14 at 9:51 am to Lsut81
Some brokers charge a fee if you sell within 30 days of buying the ETF. So watch out for that if your thinking you can make a quick turnaround.
Page 1 of 1
Back to top
Follow TigerDroppings for LSU Football News