38

One is priced in US dollars and the other is priced in euro. The euro has appreciated against the US dollar over the past three years, hence the lower return in euro than in dollars.


21

American Funds? Also look at their annual expenses. And this is from the AMCAP fund, a "growth fund" in their offering, the expenses over 10 years for a $10,000 investment: To put this in perspective, my 401(k) uses Vanguard, and for their S&P fund, VIIIX, offered only to large companies. It has a .02% expense. On $10,000, that's $2 per year. (1% ...


17

I understand that they are different financial products, exchanged on different markets with different currencies. You're right, that's the difference. One is VOO, the other is VOO priced in euros on a different exchange. I do not understand why one of them has a 3 Years Annualised returns of 18.48% while the other has 13.18%. Without looking further I'...


13

I contacted Vanguard with this question; they responded with: All fund accounts that hold Admiral(tm) Shares are reviewed for eligibility on an annual basis, typically in June. If any of your Admiral Shares fund accounts have balances below the required level at the time of this review, we will notify you by mail so that you'll have an opportunity ...


10

No, IRA contributions can only be made in the form of cash (rollovers and conversions are different). You'd have to sell the investments in your taxable account, incurring capital gains or losses, then transfer the proceeds to your IRA in cash. Note that the amount you can transfer is subject to the limits on how much one can contribute to the IRA each year. ...


10

It would involve manual effort, but there is just a handful of exclusions, buy the fund you want, plug into a tool like Morningstar Instant X Ray, find out your $10k position includes $567.89 of defense contractor Lockheed Martin, and sell short $567.89 of Lockheed Martin. Check you're in sync periodically (the fund or index balance may change); when you ...


10

Vanguard starts to adjust the weightings at 25 years out, so you're certainly right that VTIVX will soon start to be a little less aggressive (in 2020). It's not going to go drastically conservative, just a little less aggressive; from 90/10 to 80/20, perhaps. So VFIFX would be more aggressive (90/10) for a little longer (until 2025). On the other hand, ...


10

Repost of comment as an answer (as per Chirlu's suggestion). The index does not take into account the dividends paid by the stocks in the index; the ETF does. So the ETF's return outperforms the return of the index.


9

I am adding a separate answer to address one point not mentioned in @JohnBensin's answer. Vanguard funds that offer Admiral shares use a separate identifier for the Admiral shares, for example VFINX for Investor Shares in their S&P 500 Index Fund and VFIAX for the Admiral shares in the same S&P 500 Index Fund. A conversion from one class of shares ...


9

This is an example of a Collective Investment Trust (a longer read from time.com). Voya operates a CIT that buys VFIAX, and you buy into the CIT. Why would Voya not just give you VFIAX directly? A positive possibility is that using a CIT gives them institutional treatment at Vanguard and advantages that they would otherwise not get; they may have had to ...


9

A couple reasons I can think of: You can place orders for fractional shares of a mutual fund. With an ETF you can't, so you'll probably have uninvested cash. If you're uncomfortable entering orders with specific prices, or you're worried about bid-ask spread, you can enter a mutual fund order and you know it will be executed at the end of the day at the net ...


8

First, congratulations on choosing to invest in low cost passively managed plans. If you choose any one of these options and stick with it, you will already be well ahead of most individual investors. Almost all plans will allow you to re-balance between asset classes. With some companies, sales agents will encourage you to sell your overweighted assets and ...


8

The mutual fund will price at day's end, while the ETF trades during the day, like a stock. If you decide at 10am, that some event will occur during the day that will send the market up, the ETF is preferable. Aside from that, the expenses are identical, a low .14%. No real difference especially in a Roth.


8

You can have as many IRA accounts as you want (whether Roth or Traditional), so you can have a Roth IRA with American Funds and another Roth IRA with Vanguard if you like. One disadvantage of having too many IRA accounts with small balances in each is that most custodians (including Vanguard) charge an annual fee for maintaining IRA accounts with small ...


8

There are a couple of reasons why Dave Ramsey advises you to look at the 10-year performance of mutual funds. When comparing the past performance of different funds, you need to make sure that you are using the same time period for each comparison, so that each fund will have been subject to the same market conditions over the comparison window. 10 years is ...


7

No, you shouldn't get 1099. 1099 is for distributions, not contributions. You should get form 5498, in May.


7

I'd start by reading the answer to What is the difference between shares and ETF? A look at the Yahoo pages for Vanguard REIT Index Inv (VGSIX) and Vanguard REIT Index ETF (VNQ) show different annual expenses, 0.10% for the ETF, 0.24% for the fund. But, the ETF will have the trading cost of a stock purchase, say $10, which for small purchases will add up. (...


7

That's a lot of manual checking-in to see if everything is performing the way you "want". Not to insult your intelligence, but that is not your job, and doing that on a monthly basis is going to eat a lot of time. Plus, most 401(k) programs have lockout periods wherein changes can't be made without incurring additional fees (related to distributions, etc). ...


7

Mostly you nailed it. It's a good question, and the points you raise are excellent and comprise good analysis. Probably the biggest drawback is if you don't agree with the asset allocation strategy. It may be too much/too little into stocks/bonds/international/cash. I am kind of in this boat. My 401K offers very little choices in funds, but offers ...


7

Very roughly, three years ago the exchange rate was 1USD=0.9EUR while now it is 1USD=0.8EUR. Let us use those and imagine ABC corp was trading three years ago at 100USD and has risen to 150USD today. The annual return in dollars is the 1/3 power of 1.5, which is about 14.47%. In euros it has risen from 90 to 120, so the return is the 1/3 power of 120/90=4/...


7

Almost all US stock mutual funds pay out the dividends received over the year in a lump sum annually, or in some cases, semi-annually or quarterly. Bond mutual funds (and money market funds) usually pay out the interest payments from the bonds or promissory notes that they hold each month, and these payments are also called dividends (and reported as ...


6

0.13% is a pretty low fee. PTTRX expenses are 0.45%, VINIX expenses are 0.04%. So based on your allocation, you end up with at least 0.08%. While lower than 0.13%, don't know if it is worth the trouble (and potentially fees) of monthly re-balancing.


6

There are 11 members of Vanguard's Board of Directors. Nearly all are also members of the board of trustees of each Vanguard fund. The CEO of Vanguard is the Chairman of the Board of Directors. He is the only one of the 11 directors who is also actively involved in the management of Vanguard. As for the other board members, ten are independent directors ...


6

Vanguard might be the top provider of no-load mutual funds around. Attempting to do better than 0.13% in fees is just as likely to cost you more time than the money you're attempting to say. You're in your first job out of school--you've got better things to do with your time.


6

There are no tax consequences when you exchange funds in a tax-deferred account.


6

There are fund of funds,e.g. life cycle funds or target retirement funds, that could cover a lot of these with an initial investment that one could invest into for a few years and then after building up a balance large enough, then it may make sense to switch to having more control.


6

No, some of Vanguard's funds are index funds like their Total Stock Market Index and 500 Index. In contrast, there are funds like Vanguard PRIMECAP and Vanguard Wellington that are actively managed. There are index funds in both open-end and exchange-traded formats. VTI is the ticker for Vanguard's Total Stock Market ETF while VTSMX is an open-end mutual ...


6

I think the answer to your question is no, in theory. By screening out funds, you must actively manage the investments. To then try to ensure you track the index closely enough, you have to do further management. Either you spend your own time to do this or you pay someone else. This is ok, but it seems contrary to the primary reasons most people choose an ...


6

Possible but very unlikely. Money market funds invest in high grade liquid assets and the primary goal is not to lose money. I have not been able to find an example of a Vanguard money market fund ever "breaking the buck" and having the value of a share go below a dollar. It is possible that this could happen in the event of a large scale financial collapse, ...


6

If I were in your shoes I'd probably take the Vanguard Total Market fund with Admiral shares, then worry about further diversification when there is more in the account. Many times when you "diversify" in to multiple funds you end up with a lot of specific security overlap. A lot of the big S&P 500 constituents will be in all of them, etc. So while ...


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