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- Joined
- Jun 25, 2005
- Messages
- 10,252
It seems like etfs would be the better choice if you are choosing between vanguard mfs or etfs just based off of the expense ratios. Is there a hassle factor that I am forgetting for non taxed roth accounts?
The expense ratios of vanguard ETFs are the same as the expense ratios of Vanguard admiral and signal share class mutual funds. That is, there is no difference, so the expense ratio is not necessarily a reason between choosing mfs or etfs.
Also upthread it was mentioned that Vanguard would not let you buy back fund shares that you had sold in the previous 90 days. This is not true either. One has to read and follow the fine print to overcome this hassle.
The first thread I linked contradicts most of the inaccuracies stated here on this thread.
The biggest difference from reading forum threads is that many folks cannot figure out whether to choose a market order or limit order for an ETF and how to set a limit price. It gives them an anxiety attack.
Another difference between them: ETF trades settle in T+3 days. Mutual fund trades settle in T+1. The consequence is that if you sell an ETF to raise cash, you will not be able to get the cash into your checking account until 3 days later (and maybe that takes an extra day for ACH, so 4 days later).
Also I would not submit an ETF order while the market is closed because it is very easy to not get a fair price. In contrast, when you submit a mutual fund order, you always get a fair price ... even if you submit an order when the market is closed.
I own ETFs and mutual funds.
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