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08-08-2018, 08:54 AM
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#81
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Recycles dryer sheets
Join Date: Aug 2013
Posts: 437
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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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08-08-2018, 09:54 AM
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#82
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Mar 2017
Location: City
Posts: 10,351
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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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08-08-2018, 09:58 AM
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#83
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Apr 2013
Posts: 11,078
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+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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08-08-2018, 12:06 PM
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#84
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Thinks s/he gets paid by the post
Join Date: Mar 2013
Posts: 1,788
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Quote:
Originally Posted by Basora
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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.
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08-08-2018, 02:19 PM
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#85
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Apr 2013
Posts: 11,078
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Quote:
Originally Posted by ER Eddie
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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Yeah Fast Eddie only knows about raising fees!
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08-08-2018, 02:22 PM
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#86
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jan 2006
Location: Rio Grande Valley
Posts: 38,139
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Well Fidelity certainly got HUGE publicity out of this move!
__________________
Retired since summer 1999.
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08-08-2018, 03:48 PM
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#87
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Apr 2013
Posts: 11,078
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Quote:
Originally Posted by audreyh1
Well Fidelity certainly got HUGE publicity out of this move!
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+1
They couldn't have bought as much press for as little immediate cost.
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08-08-2018, 04:05 PM
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#88
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: May 2008
Posts: 7,436
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Interesting timing on this.
So who’s going to bite or has bitten?
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08-08-2018, 04:22 PM
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#89
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jan 2006
Location: Rio Grande Valley
Posts: 38,139
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Quote:
Originally Posted by explanade
Interesting timing on this.
So who’s going to bite or has bitten?
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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.
__________________
Retired since summer 1999.
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08-08-2018, 04:33 PM
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#90
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Thinks s/he gets paid by the post
Join Date: Jul 2011
Location: The Bay Area
Posts: 2,736
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Quote:
Originally Posted by audreyh1
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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Likely to choose the same course of action.
__________________
You may be whatever you resolve to be.
100% x 10% > 10% x 100%
Small pensions & SS cover essentials
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08-08-2018, 05:19 PM
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#91
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Thinks s/he gets paid by the post
Join Date: Mar 2013
Posts: 1,788
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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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08-08-2018, 05:28 PM
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#92
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Mar 2017
Location: City
Posts: 10,351
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Quote:
Originally Posted by ER Eddie
... 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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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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08-08-2018, 08:15 PM
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#93
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Thinks s/he gets paid by the post
Join Date: Mar 2013
Posts: 1,788
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Quote:
Originally Posted by OldShooter
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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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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08-09-2018, 05:42 AM
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#94
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Full time employment: Posting here.
Join Date: Feb 2017
Location: Severn
Posts: 947
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Quote:
Originally Posted by explanade
Interesting timing on this.
So who’s going to bite or has bitten?
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I picked some up with a little cash I had in my accounts (~$300)
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08-09-2018, 08:38 AM
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#95
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Mar 2017
Location: City
Posts: 10,351
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Quote:
Originally Posted by ER Eddie
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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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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08-09-2018, 10:48 AM
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#96
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jan 2018
Location: Tampa
Posts: 11,298
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Quote:
Originally Posted by OldShooter
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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Correct. With Fidelity, one must use 2 funds to replicate the world.
__________________
TGIM
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08-09-2018, 11:00 AM
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#97
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Sep 2012
Posts: 11,702
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Quote:
Originally Posted by jetpack
It looks like Fidelity has taken down many of their promos for signing up.. and replaced that with lower fees.
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Next think you know they'll be taking away the complimentary TurboTax.
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08-09-2018, 11:13 AM
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#98
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jan 2006
Location: Rio Grande Valley
Posts: 38,139
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Quote:
Originally Posted by JoeWras
Next think you know they'll be taking away the complimentary TurboTax.
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Maybe when I've transitioned to all index funds, LOL!
__________________
Retired since summer 1999.
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08-09-2018, 11:42 AM
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#99
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Full time employment: Posting here.
Join Date: Jan 2008
Location: Flyover America
Posts: 679
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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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08-09-2018, 02:27 PM
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#100
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Full time employment: Posting here.
Join Date: Sep 2007
Location: mpls, mn
Posts: 769
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Quote:
Originally Posted by JoeWras
Next think you know they'll be taking away the complimentary TurboTax.
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don't give them any ideas! you know they're watching this thread, right.
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