Would you trade Fidelity funds to buy Vanguard?

[pb4uski]

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Originally Posted by Animorph Vanguard makes you hold mutual funds in a separate account from stocks/ETF's. That was one reason we ended up at Fidelity. With the separate accounts it will take 3 days to settle an ETF trade (industry standard, not Vanguard's fault), and then a day to transfer that cash to your MF account I guess. With Fidelity, they sort of float you a loan during the settlement period, which allows you to sell an ETF and buy a different ETF or mutual fund the same day with the sales proceeds. Standard brokerage procedure, but since Vanguard doesn't hold your MF's in a brokerage account it doesn't work with them.

A Vanguard rep recently told me that they plan to merge MF and brokerage accounts in 2013. My IRA currently has an MF account and a brokerage account but once they change it'll be just one account.

[MapleShade]

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Originally Posted by audreyh1 Fidelity has a $75 transaction fee on Vanguard funds and some other fund families, other fund families are NTF (no transaction fee). It all depends on the agreement between Fidelity and the fund family. Transaction fees are usually required by the target fund company to protect their direct shareholders, and you can avoid them by investing directly with the fund company instead of through Fidelity's convenient "supermarket". I own some transaction fee funds (transaction fee only apply when buying, not selling), and I usually wait until I have a large enough sum to invest to lower the impact of the transaction fee. Like say $10,000 min. If you are investing small amounts, you might want to consider transferring the assets directly to the MF company.

I have been at Fidelity for 20 years and own both Wellington and Wellesley. I paid the $75 transaction fee on my initial purchase of each. JFYI, for additional purchases, you can set up Automatic Investments to purchase additional amounts for only a $5 fee. It is a very flexible method to save on newer purchases. I have set it up for as little as two transactions,i.e, $5000 to invest, $2500 on Jan 5 and $2500 0n Feb 5. Total fee cost $10, saving $140. Then you don't have to wait for a larger amount to invest. You can even change the additional amounts after the first to whatever you need it to be, i.e., $2500 1/5 and $1000 2/5. You may want to look into it. Of course you could use equivalent ETF's for other Vanguard funds but Wellington and Wellesley don't have any.

Hope that helps

[freetodream]

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Originally Posted by MapleShade I have been at Fidelity for 20 years and own both Wellington and Wellesley. I paid the $75 transaction fee on my initial purchase of each. JFYI, for additional purchases, you can set up Automatic Investments to purchase additional amounts for only a $5 fee. Hope that helps

It does help; so there are investors buying Vanguard funds at Fidelity. And being able to purchase additional amounts with automatic investments makes me want to look into a change (purchase) next year.