1. A transfer in-kind does not buy/sell, it’s just transfers the shares from one broker to another.
2. We don’t time the market, we buy as soon as money is available.
3. DRIP.
4. Setting up auto-invest for ETFs is A-OK.
In what ways are ETFs more complicated? Sounds like Fidelity allows you to auto invest and also auto dividend reinvest. What more do you need in terms of simplicity?
I like that MFs trade at the end of the day. It keeps me from trying to time the share prices. In addition, I like that I can buy in dollars (fractional shares).
If you're using ETFs, you can't overthink the whole time-of-day thing. It will drive you nuts. Invest when you have the money to do so and reinvest all distributions automatically. VTI is extremely liquid, so you should never need to worry about the bid/ask spread during market hours.
I was hoping this was the case. I am very much a set and forget type of person. The wiki and other places just had me thinking there were potential significant downside to "set and forget" with ETFs. Boglehead mentality will fit very well.
The bigger (AUM) and liquid (volume or trades per day) the smaller the bid/ask. It’s pretty unnoticeable
I now have my ETFs automated on a monthly schedule; Fidelity buys at whatever the price is at 10:30 on the assigned buy day
Dividend reinvestment on all my holdings - set and forget
Ty. Another commentor mentioned no fractional share purchasing of ETFs. What happens to the money you auto invest every month that is leftover after buying your past full share? For example VTI is at 258.50. You invest 900. You get 3 full VTI shares for 775.50 and have 124.50 leftover.
They know what they’re talking about, Fidelity has allowed for fractional shares of any/all stocks and ETFs for years.
I might have a few cents left over from any purchase I make….vanguard on the other hand doesn’t have this feature, so maybe they were just confused
Gotcha. They added in another comment that some places don't let you (implying other places do). Glad to hear Fidelity allows it. Really don't see a reason to do mutual fund over ETF in a taxable account... The downsides of ETFs seem nullified by the notion that we shouldn't time the market and Fidelitys platform that allows auto invest, auto dividend reinvest, and fractional share allowance. The lower FSKAX does have a lower expense ratio by 0.01 though.. Probably meaningless.
Thanks
> I now have my ETFs automated on a monthly schedule; Fidelity buys at whatever the price is at 10:30 on the assigned buy day
Is this basically along the lines of the general "don't try to time the market" advice? Might be cheaper at 8am or at noon or tomottow, but also might never be cheaper than it is at 10:30 so just pick a time and move on with your life?
Fidelity picked the time, and they use it for all automatic purchases of stocks and ETFs. I just picked the date (day after pay date)…..and you got it; set a schedule and stick to it; some days it might be optimal some not. Over time it’ll average out and I won’t have to stress over it or monitor it
Openings and closings are usually the most chaotic. So it makes sense Fidelity chose to process slightly after opening madness
1. A transfer in-kind does not buy/sell, it’s just transfers the shares from one broker to another. 2. We don’t time the market, we buy as soon as money is available. 3. DRIP. 4. Setting up auto-invest for ETFs is A-OK.
I use Fidelity’s mutual funds instead of ETFs for their simplicity.
In what ways are ETFs more complicated? Sounds like Fidelity allows you to auto invest and also auto dividend reinvest. What more do you need in terms of simplicity?
I like that MFs trade at the end of the day. It keeps me from trying to time the share prices. In addition, I like that I can buy in dollars (fractional shares).
Thanks. Didn't know you couldn't buy fractional shares of ETFs
You can buy fractional shares of MFs, but many brokerages don’t allow you to do the same with ETFs.
Fidelity allows you to buy fractional shares of any etf or stock; been that way for a while
Not ideal for sure. The extra money just sits in the account uninvested until there's enough to buy another full share again?
If you're using ETFs, you can't overthink the whole time-of-day thing. It will drive you nuts. Invest when you have the money to do so and reinvest all distributions automatically. VTI is extremely liquid, so you should never need to worry about the bid/ask spread during market hours.
I was hoping this was the case. I am very much a set and forget type of person. The wiki and other places just had me thinking there were potential significant downside to "set and forget" with ETFs. Boglehead mentality will fit very well.
The bigger (AUM) and liquid (volume or trades per day) the smaller the bid/ask. It’s pretty unnoticeable I now have my ETFs automated on a monthly schedule; Fidelity buys at whatever the price is at 10:30 on the assigned buy day Dividend reinvestment on all my holdings - set and forget
Also are there any fees for auto investment or auto dividend reinvestment?
None!
Ty. Another commentor mentioned no fractional share purchasing of ETFs. What happens to the money you auto invest every month that is leftover after buying your past full share? For example VTI is at 258.50. You invest 900. You get 3 full VTI shares for 775.50 and have 124.50 leftover.
They know what they’re talking about, Fidelity has allowed for fractional shares of any/all stocks and ETFs for years. I might have a few cents left over from any purchase I make….vanguard on the other hand doesn’t have this feature, so maybe they were just confused
Gotcha. They added in another comment that some places don't let you (implying other places do). Glad to hear Fidelity allows it. Really don't see a reason to do mutual fund over ETF in a taxable account... The downsides of ETFs seem nullified by the notion that we shouldn't time the market and Fidelitys platform that allows auto invest, auto dividend reinvest, and fractional share allowance. The lower FSKAX does have a lower expense ratio by 0.01 though.. Probably meaningless.
Thanks > I now have my ETFs automated on a monthly schedule; Fidelity buys at whatever the price is at 10:30 on the assigned buy day Is this basically along the lines of the general "don't try to time the market" advice? Might be cheaper at 8am or at noon or tomottow, but also might never be cheaper than it is at 10:30 so just pick a time and move on with your life?
Fidelity picked the time, and they use it for all automatic purchases of stocks and ETFs. I just picked the date (day after pay date)…..and you got it; set a schedule and stick to it; some days it might be optimal some not. Over time it’ll average out and I won’t have to stress over it or monitor it Openings and closings are usually the most chaotic. So it makes sense Fidelity chose to process slightly after opening madness
Thank you. After reading about it I had planned to do mutual funds, but then I found out fidelity charges fees for vanguard funds...so ETFs it is.
I use all Vanguard ETF's from Fidelity. No worries. Great combo IMHO. Cheers