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Old 08-08-2018, 08:54 AM   #81
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Will Vanguard follow suit and lower fees? Can they even do that?

Pretty much the only thing I've liked about vanguard is the lowest fees around.. and if they aren't doing that anymore, I'll have to think about opening a fidelity acct. Now, I'm not going to be able to move any old money easily, but new money into fidelity?

It looks like Fidelity has taken down many of their promos for signing up.. and replaced that with lower fees.
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Old 08-08-2018, 09:54 AM   #82
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Vanguard is a mutual company, owned by the fund shareholders. So they have to net recover their costs over the long term but they do not have stockholders wanting profits & dividends. Whether they can cross-subsidize lines of business within this total constraint is probably a Board decision. We'll see, I guess.

But, for me, 4bps is not a meaningful difference. So I'm not interested in Fido's US total market fund. The international fund is mildly more interesting but I looked at the prospectus and it looks like a developed market/large cap fund. I want more coverage than that internationally, so no current interest in that one either. Finally , I expect this period of cutthroat price competition to end sometime in the near future. These companies, especially the for-profits like Blackrock, Schwab, and Fido have to make money. Market share with no profits doesn't do it.

A couple of comments about watching to see how the funds do. IMO a reasonably intelligent monkey can run a simple index fund like these, so I expect virtually a 1.0 correlation coefficient compared to other similar funds. No need to wait and watch IMO.
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Old 08-08-2018, 09:58 AM   #83
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It's not more of you they want to know about, but attract other clients, increase their market share and further information. There is something in it for them, they aren't a charity
+1

I was in the industry when the number 2 fund company became number 1. A very conservative company and that's all they talked about. Yes there's an indirect benefit to being able to say "We have the most AUM".
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Old 08-08-2018, 12:06 PM   #84
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Edward Jones tried this ... and are now getting sued. See - https://onwallstreet.financial-plann...fiduciary-rule

Caveat Emptor.
I don't think that's the same scenario. The article is referencing a scam to move people into higher-cost funds. I'm going the opposite direction.

I'm doing two things: 1) moving money out of a financial advisor's hands and into my own, and 2) moving funds from 1% expense ratios to near-zero expense ratios. They'll be making less money off me, not more.
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Old 08-08-2018, 02:19 PM   #85
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I don't think that's the same scenario. The article is referencing a scam to move people into higher-cost funds. I'm going the opposite direction.

I'm doing two things: 1) moving money out of a financial advisor's hands and into my own, and 2) moving funds from 1% expense ratios to near-zero expense ratios. They'll be making less money off me, not more.
Yeah Fast Eddie only knows about raising fees!
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Old 08-08-2018, 02:22 PM   #86
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Well Fidelity certainly got HUGE publicity out of this move!
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Old 08-08-2018, 03:48 PM   #87
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Well Fidelity certainly got HUGE publicity out of this move!
+1
They couldn't have bought as much press for as little immediate cost.
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Old 08-08-2018, 04:05 PM   #88
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Interesting timing on this.

So who’s going to bite or has bitten?
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Old 08-08-2018, 04:22 PM   #89
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Interesting timing on this.

So who’s going to bite or has bitten?
Well I already have several Fidelity Index funds, and I'll stay with them since they lowered the ER on the equivalent ones to 0.015% from 0.035%

Close enough to zero for me, I really don't want to change funds.
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Old 08-08-2018, 04:33 PM   #90
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Well I already have several Fidelity Index funds, and I'll stay with them since they lowered the ER on the equivalent ones to 0.015% from 0.035%

Close enough to zero for me, I really don't want to change funds.
Likely to choose the same course of action.
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Old 08-08-2018, 05:19 PM   #91
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I'll probably sign up for some of 'em. Like Old Shooter said, these are simple index funds, so they should correlate well with other funds. No real need to worry about the track record. I've got 400K to distribute among different index funds, and I don't see any reason to avoid these. I won't put all the money in them, but I'll probably put some in.
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Old 08-08-2018, 05:28 PM   #92
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... I've got 400K to distribute among different index funds, and I don't see any reason to avoid these. I won't put all the money in them, but I'll probably put some in.
Just out of curiosity, why aren't you putting all the money in one or two funds, like a total US and a total International? Are you buying sector funds? FWIW I have been moving our portfolio towards having everything in just one fund, VG's total world fund. Less to keep track of.
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Old 08-08-2018, 08:15 PM   #93
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Just out of curiosity, why aren't you putting all the money in one or two funds, like a total US and a total International? Are you buying sector funds? FWIW I have been moving our portfolio towards having everything in just one fund, VG's total world fund. Less to keep track of.
I plan to model it on the AA in my Vanguard account, which would mean 70/30 stocks/bonds, with 75/25 US stocks/international stocks, and 80/20 US bonds/int'l bonds. I also have some in a small cap fund and some in a large cap growth fund. I was thinking of doing similar with Fidelity, although I also might mix it a little differently. I haven't decided for sure yet.

I didn't know there was a Total World Fund. Interesting.
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Old 08-09-2018, 05:42 AM   #94
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Interesting timing on this.

So who’s going to bite or has bitten?
I picked some up with a little cash I had in my accounts (~$300)
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Old 08-09-2018, 08:38 AM   #95
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I plan to model it on the AA in my Vanguard account, which would mean 70/30 stocks/bonds, with 75/25 US stocks/international stocks, and 80/20 US bonds/int'l bonds. I also have some in a small cap fund and some in a large cap growth fund. I was thinking of doing similar with Fidelity, although I also might mix it a little differently. I haven't decided for sure yet.

I didn't know there was a Total World Fund. Interesting.
Oh, OK. I am kind of blind on bond funds as we will not buy them. So I think of "funds" and "equity" as pretty much the same thing. Hence the question.

VG's total world fund is "Vanguard Total International Stock Index Fund " VGTSX is the flavor I can buy at Schwab. There is also an Admiral class that can be bought only if you are at VG and an ETF flavor, VT. Schwab doesn't have anything like it and last time I checked Fido didn't either. Basically it gives me zero home country bias, as the US is in there based on its market cap as a % of the total world market cap. I am pretty much addicted to the Fama/French Kool-Aid, like: https://famafrench.dimensional.com/v...home-bias.aspx

Different subject/related:

There is quite a good Morningstar article on the Fido strategy and the changing environment for brokerage houses this morning: https://www.morningstar.com/articles...kerage-bu.html

One of the things he says is quite amusing and not far off the point of this thread:
"It is as if Fidelity runs an amusement park and has just eliminated the admission charge for its most-popular ride. Now, visitors can journey to FidelityLand, frequent only that attraction, and return home not one penny poorer. However, Fidelity thinks that won't happen. Those who spend the day at FidelityLand figure to score some snacks and hop on other rides. Perhaps they will buy a souvenir."
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Old 08-09-2018, 10:48 AM   #96
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Oh, OK. I am kind of blind on bond funds as we will not buy them. So I think of "funds" and "equity" as pretty much the same thing. Hence the question.

VG's total world fund is "Vanguard Total International Stock Index Fund " VGTSX is the flavor I can buy at Schwab. There is also an Admiral class that can be bought only if you are at VG and an ETF flavor, VT. Schwab doesn't have anything like it and last time I checked Fido didn't either. Basically it gives me zero home country bias, as the US is in there based on its market cap as a % of the total world market cap. I am pretty much addicted to the Fama/French Kool-Aid, like: https://famafrench.dimensional.com/v...home-bias.aspx

Different subject/related:

There is quite a good Morningstar article on the Fido strategy and the changing environment for brokerage houses this morning: https://www.morningstar.com/articles...kerage-bu.html

One of the things he says is quite amusing and not far off the point of this thread:
"It is as if Fidelity runs an amusement park and has just eliminated the admission charge for its most-popular ride. Now, visitors can journey to FidelityLand, frequent only that attraction, and return home not one penny poorer. However, Fidelity thinks that won't happen. Those who spend the day at FidelityLand figure to score some snacks and hop on other rides. Perhaps they will buy a souvenir."
Correct. With Fidelity, one must use 2 funds to replicate the world.
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Old 08-09-2018, 11:00 AM   #97
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It looks like Fidelity has taken down many of their promos for signing up.. and replaced that with lower fees.
Next think you know they'll be taking away the complimentary TurboTax.
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Old 08-09-2018, 11:13 AM   #98
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Next think you know they'll be taking away the complimentary TurboTax.
Maybe when I've transitioned to all index funds, LOL!
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Old 08-09-2018, 11:42 AM   #99
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I sold some individual stocks and put the cash proceeds into the 2 fidelity zero funds. 50/50 US/Int
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Old 08-09-2018, 02:27 PM   #100
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Next think you know they'll be taking away the complimentary TurboTax.
don't give them any ideas! you know they're watching this thread, right.
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