Vanguard Struggles to Win Over the World

[zippy2020]

(free link: https://www.bloomberg.com/news/articles/2023-07-16/vanguard-pitches-etfs-and-other-funds-to-european-investors-is-anyone-buying?accessToken=eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJzb3VyY2UiOiJTdWJzY3JpYmVyR2lmdGVkQXJ0aWNsZSIsImlhdCI6MTY4OTY5NjYzNSwiZXhwIjoxNjkwMzAxNDM1LCJhcnRpY2xlSWQiOiJSWFdWVUhUMVVNMFcwMSIsImJjb25uZWN0SWQiOiJENEFFMDBEMUVBNjg0QUM1OEEwMDZFQzI3NkFDNERDQyJ9.NUU6N8LfKsUS63wxkAaWKsnEmtXwoIaiEqNupYRlHKY

Interesting read on Vanguard's stumbles across the oceans.

 

[tulak]

(free link: https://www.bloomberg.com/news/arti...9.NUU6N8LfKsUS63wxkAaWKsnEmtXwoIaiEqNupYRlHKY



Interesting read on Vanguard's stumbles across the oceans.

It’s behind a paywall. If you have an Apple News subscription, you can get to it here: https://apple.news/ASHOStqAsQuW5PntksJucxA

 

[Route246]

I read it and get it. I am almost all-in on Vanguard and they have served me well. I don't think it is just international penetration that is challenging.

Some friends have asked me what to do with inheritances or extra savings and I always recommend opening a Vanguard account, buy SPY or VTI and let it alone. I get some puzzled looks and none of them have taken me up on this. It is too complicated to explain expense ratios and how important they are for the self-service saver to reduce to the absolute minimum in order for your compounding to work optimally. A few like EJ which I have only heard is very expensive in terms of commissions, loads and expense ratios, kind of the opposite of Vanguard. I couldn't imagine what our finances would be like if it wasn't for Vanguard.

 

[mrfeh]

I read it and get it. I am almost all-in on Vanguard and they have served me well. I don't think it is just international penetration that is challenging.

Some friends have asked me what to do with inheritances or extra savings and I always recommend opening a Vanguard account, buy SPY or VTI and let it alone. I get some puzzled looks and none of them have taken me up on this. It is too complicated to explain expense ratios and how important they are for the self-service saver to reduce to the absolute minimum in order for your compounding to work optimally. A few like EJ which I have only heard is very expensive in terms of commissions, loads and expense ratios, kind of the opposite of Vanguard. I couldn't imagine what our finances would be like if it wasn't for Vanguard.

Plenty of alternatives to Vanguard for low ER index funds.

 

[FREE866]

I like that I can buy VTI in my Schwab account, but I would never ever open an account with Vanguard. The customer service I received when trying to get my deceased brother in laws money out of there was so awful. I started a thread about it. Deplorable.

 

[easysurfer]

I've changed uniforms recently from VG to Fido. No regrets.

Fido's customer service has been great.

Though there was on "You can not be serious" moment. Namely, trying to call a person greeted me with on the phone, enter your userID and password. My password is a long randomly generated password. You can not be serious. I'm not going to struggle entering that on phone.

I then reached someone by their chat instead and they've been helpful and answered my questions.

 

[easysurfer]

Plenty of alternatives to Vanguard for low ER index funds.

I'm still an index funds (not ETF) guy. After going from VG to Fido, I'm going for Fidelity's zero ER index funds .

 

[SnowballCamper]

I can't read the paywall article...

But I have always wondered what proportion of the market has to be active investors in order for the low cost index investors to have their relative advantage (on average)?

 

[Montecfo]

It is a good question ^^^

But speaking more broadly, I have been intrigued that VG does not participate in annual reviews of their brokerage e.g., by Kiplinger and Barron's.

I assume they know they would not fare well. For that reason and that I am more individual stocks and not an indexer, I have not found VG to be an alternative.

 

[Koolau]

Long time VG customer and have been pretty much satisfied with their service. Only big complaint is there recent $25/fund charge for paper reports. That's a bummer because I like the paper - especially for year end reports.

 

[DrRoy]

Fido has largely matched them on fees.

 

[target2019]

Get a free Bloomberg account. Strip the token from the original link. https://www.bloomberg.com/news/arti...-funds-to-european-investors-is-anyone-buying

From the article,

For a time, Vanguard was pitching very British FTSE 100 index funds to people in Zurich. Swiss staff had to explain that Swiss wealth managers catering to Swiss clients expected investment products denominated in Swiss francs, in addition to euros and dollars. One employee recalls explaining to bosses that what worked once for Vanguard in Tokyo might not work today in Berlin.

So far, most of what I'm reading is about Vanguard just not understanding that each country has regulation, culture, and few exceptions for giant companies.

 

[target2019]

Here's a quote that would set you up for failure in Europe:

“We’re here to change the European market,” Hagerty, managing director for Vanguard Europe, said in an interview. “It needs to be changed.”

I'm not an expert on all things foreign, but the arrogance in a statement like that would harden my German friend against the interloper.

 

[Midpack]

Long time VG customer and have been pretty much satisfied with their service. Only big complaint is their recent $25/fund charge for paper reports. That's a bummer because I like the paper - especially for year end reports.

You can’t just print the online report? IIRC it’s the exact same document, so they should charge for people who still want one printed and mailed. I print mine once a year to add to my trust docs.

 

[Koolau]

You can’t just print the online report? IIRC it’s the exact same document, so they should charge for people who still want one printed and mailed. I print mine once a year to add to my trust docs.

I've never found a printer that lasts.

I'm probably going to go paperless and buy a laser printer.

 

[Alan]

I've never found a printer that lasts.

I'm probably going to go paperless and buy a laser printer.

I stopped printing statements a long time ago, but I also don’t rely on banks, credit card companies and brokerages to keep my statements online for anytime I want to access them. Instead I save all the statements as pdf files on my laptop (backed up of course). I have a folder called statements in which there is a folder for every year into which I save the pdfs.

 

[Badger]

I have been with Vanguard for a number of years as an Admiral shareholder. They also automatically take care of our RMDs. However, there seems to be less service as well as a removal of our personal rep. Even though I rarely used him/her it was nice to have a direct contact line instead of going through menus to talk to someone.
I like getting paper reports and am not happy with being charged for our accounts especially as an Admiral shareholder. I may want to talk to my advisor at Schwab about having them handle my Vanguard accounts unless it would add more confusion to the mix. I also think that Schwab is encouraging people to switch to digital reports too. At least at Schwab I have a few people there I have known for a number of years that are helpful and know how I like to handle my investments.

Cheers!

 

[MRG]

Get a free Bloomberg account. Strip the token from the original link. https://www.bloomberg.com/news/arti...-funds-to-european-investors-is-anyone-buying



From the article,







So far, most of what I'm reading is about Vanguard just not understanding that each country has regulation, culture, and few exceptions for giant companies.

Thanks for posting a part of the article.

My work was around financial services and was part of the team that took our back office product international. We learned a lot about different cultures and accepted practices.

The European market seemed pretty independent, and things that were accepted practices in the US were not accepted there. You could also find practices that were well accepted by some countries and considered punitive in others.

I see some European people talking about Vanguard on Reddit, but it appears to be a minority. If Vanguard wants that market, it won't be easy or inexpensive.

 

[easysurfer]

Long time VG customer and have been pretty much satisfied with their service. Only big complaint is there recent $25/fund charge for paper reports. That's a bummer because I like the paper - especially for year end reports.

Aren't the fees both for if you want paper reports or if you stay on their fund only platform?

On the article, IMO, I think VG is experiencing the too big to fail situation. They used to be the Amazon of mutual funds and still have a friendly, small neighborly feel (kind of like Amazon still manages to do). But that's sort of change to do it their way or the highway.

There was a time before I discovered Vanguard's indexing approach, I had plenty of funds. But then the light bulb turned on. Indexing, super low cost. So I get rid off all the other funds and went totally to VG. But that was then. Not the only game in town anymore .

 

[Koolau]

Aren't the fees both for if you want paper reports or if you stay on their fund only platform?

On the article, IMO, I think VG is experiencing the too big to fail situation. They used to be the Amazon of mutual funds and still have a friendly, small neighborly feel (kind of like Amazon still manages to do). But that's sort of change to do it their way or the highway.

There was a time before I discovered Vanguard's indexing approach, I had plenty of funds. But then the light bulb turned on. Indexing, super low cost. So I get rid off all the other funds and went totally to VG. But that was then. Not the only game in town anymore .

The $25 is for EACH of these issues as I've already switched over to brokerage and they will still charge $25 for not going paperless.

 

[easysurfer]

The $25 is for EACH of these issues as I've already switched over to brokerage and they will still charge $25 for not going paperless.

Okay. I was still on the old fund platform before I saw green and jumped ship.

 

[Alan]

I'm probably going to go paperless and buy a laser printer.

The $25 is for EACH of these issues as I've already switched over to brokerage and they will still charge $25 for not going paperless.

$25/fund/year will soon fund that laser printer

 

[Brook2]

$25 fee was final straw for me. I left VG

Long time VG customer and have been pretty much satisfied with their service. Only big complaint is there recent $25/fund charge for paper reports. That's a bummer because I like the paper - especially for year end reports.

So, another VG attempt to chip away their old services. I don't recognize this company anymore since 20 years ago. I switched to Schwab and Fidelity. If you want old customers to continue to feel welcome, offer a $25 discount to those who shift to digital instead of punishing those who don't. None of my other financial institutions or banks punish people for paper.

 

[Koolau]

So, another VG attempt to chip away their old services. I don't recognize this company anymore since 20 years ago. I switched to Schwab and Fidelity. If you want old customers to continue to feel welcome, offer a $25 discount to those who shift to digital instead of punishing those who don't. None of my other financial institutions or banks punish people for paper.

What gets me is most of my accounts aren't $1000. They're 10's to 100+ times that. I don't doubt it costs them something to print and mail the reports, but don't they make a ton on having me as a customer?

It feels like a betrayal. I KNOW that not everyone has a printer (I don't) and there are even people who don't have a computer (I do.)

With the million dollar limit, it appears they really don't want the "small" investors anymore. Maybe that's it.

 

[MRG]

What gets me is most of my accounts aren't $1000. They're 10's to 100+ times that. I don't doubt it costs them something to print and mail the reports, but don't they make a ton on having me as a customer?



It feels like a betrayal. I KNOW that not everyone has a printer (I don't) and there are even people who don't have a computer (I do.)



With the million dollar limit, it appears they really don't want the "small" investors anymore. Maybe that's it.

You are vastly underestimating the ongoing costs to pay for printing, postage, and ongoing software maintenance(Megacorp charged 18-22% annually for maintenance).

In my way back machine, I remember getting my first programming job. It was justified as I was working on a project to eliminate duplicate financial statements. Wasn't just me, Megacorp invested around 15 person years of development.