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Re: How many brokerage firms are you using?

Posted: Thu Sep 12, 2019 7:54 pm
by vnatale
Thanks for your full response.

In regards to the last sentence you wrote, it is clear that you do not believe that you do need to be in more than one brokerage for diversification purposes.

Craig Rowland's book definitely emphasized using more than one.

Vinny
dualstow wrote:
Thu Sep 12, 2019 9:12 am
Two.

I only meant to have Vanguard, but they weren’t doing solo 401k’s when I set mine up, so I used Fidelity for that. I had a rough beginning with Fidelity, but then it smoothed out. Friendly service at their physical branches. There was one guy one year who took my annual contribution out of my hand, processed it and tossed the receipt to me without a word, but that was one guy.

Vanguard certainly has growing pains. I had good service over the phone and online for the most part.
+ I had some directly held shares of this and that from when I was a kid, and Vanguard made it easy to transfer those over.
+ I got out of a smaller brokerage that I should have never been in. That was also from when I was young and didn’t have control over my investments. Vanguard got that done with no problems.

- I was disappointed in the beneficiary thing detailed by mathjak above. My dad and I had a joint account from my childhood, and for me it had never mattered that his name was attached. One day, I noticed that my wife’s name was no longer mentioned as my beneficiary. Or, I may have learned it when mathjak mentioned it in the past.

Vanguard had never told me about it. I had to ask them. And, almost my entire savings was in this joint account. We had to jump through some hoops to get the account in my name only so i could restore my wife as the named beneficiary. Not the end of the world, but...they should have told me.
- A few other headaches. No one’s perfect.

I do like that Vanguard is like a co-op where every shareholder is kind of a co-owner. I think about that when I buy shares of a corporate bond fund with a purchase fee. Fidelity, as good as they are, are not like that. I remember asking them how much money I had to have in my account to get free trades like I do at Vanguard (US$2 if I run out of free trades each year). The answer: they don’t have different levels. Everyone has to pay for trading.

I like both firms and would not want to diversify any further. Even one firm would be enough for me, plus a checking account elsewhere.

Re: How many brokerage firms are you using?

Posted: Thu Sep 12, 2019 8:03 pm
by dualstow
vnatale wrote:
Thu Sep 12, 2019 7:54 pm
Thanks for your full response.

In regards to the last sentence you wrote, it is clear that you do not believe that you do need to be in more than one brokerage for diversification purposes.

Craig Rowland's book definitely emphasized using more than one.
It’s a fine book, but I’ll take my chances.

Re: How many brokerage firms are you using?

Posted: Fri Sep 13, 2019 5:56 am
by mathjak107
2 years ago we had our fidelity account locked tight when their team of hackers found my wifes account info on the dark web ..

they scan for fidelity related stuff and even though she never logs in at all they got her info .

so fidelity locked the account and it took about two weeks to re-establish the accounts , get new cards and checks and move the money .

luckily we keep a local bank account where we have money to keep things going since fidelity is our cma account for paying all bills

Re: How many brokerage firms are you using?

Posted: Fri Sep 13, 2019 7:52 am
by sophie
Good, instructive story, mathjak.

I use both Vanguard and Fidelity, along with a conventional brick and mortar bank (Chase). I originally was all in Fidelity, but ended up opening an individual brokerage at Vanguard to go along with my employer retirement accounts there, and to take advantage of some Vanguard funds that are far superior to their counterparts at Fidelity (treasury money market and small cap value). If either of them were to be locked up, I'd be able to manage with funds in the other brokerage plus the Chase account.

Fidelity and Vanguard complement each other nicely, I find. Fidelity wins on customer service, the HSA, the powerful cash management and multiple-account setup, and investing in individual Treasuries. Vanguard wins on fees.

Re: How many brokerage firms are you using?

Posted: Fri Sep 13, 2019 9:38 am
by shekels
Fidelity has a Money transfer lockdown that is available to
Lock your accounts instantly:
Block electronic money movement out of your accounts, protecting your balances from unauthorized transfers.
EDITing to make a little more sense from post
https://www.fidelity.com/security/overview

Re: How many brokerage firms are you using?

Posted: Fri Sep 13, 2019 11:09 am
by Kriegsspiel
shekels wrote:
Fri Sep 13, 2019 9:38 am
Fidelity has a Money transfer lockdown
Lock your accounts instantly:
Block electronic money movement out of your accounts, protecting your balances from unauthorized transfers.
Vanguardvs.Fidelity-5c61b9cfc9e77c0001d321d4.png
?

Re: How many brokerage firms are you using?

Posted: Fri Sep 13, 2019 2:38 pm
by shekels
Kriegsspiel wrote:
Fri Sep 13, 2019 11:09 am
shekels wrote:
Fri Sep 13, 2019 9:38 am
Fidelity has a Money transfer lockdown
Lock your accounts instantly:
Block electronic money movement out of your accounts, protecting your balances from unauthorized transfers.
?
Not sure if it is a great thing or not. The blocking feature can be turned on or off.
https://www.fidelity.com/security/overview

Re: How many brokerage firms are you using?

Posted: Fri Sep 13, 2019 3:11 pm
by Kriegsspiel
Oh I see. I thought you were letting everyone know there was some kind of security situation...

Re: How many brokerage firms are you using?

Posted: Fri Sep 13, 2019 4:05 pm
by shekels
Kriegsspiel wrote:
Fri Sep 13, 2019 3:11 pm
Oh I see. I thought you were letting everyone know there was some kind of security situation...
Looking back over the post. I see your point. Sorry for that.

Re: How many brokerage firms are you using?

Posted: Fri Sep 13, 2019 4:09 pm
by Xan
I sometimes wonder about that. Police cars have plastered on their side "Call 911!" We have alert thingies on the highway that give a license plate of a child abductor or missing old person or something that will say "Missing elderly, blue Honda, license XYZ. Call 911!"

I'm always tempted to call 911 and say, "Yes? What can I do for you?" Never have though.

Re: How many brokerage firms are you using?

Posted: Fri Sep 13, 2019 8:08 pm
by Kriegsspiel
How many of you dialed 1-800-5-FRANCE

Age test.

Re: How many brokerage firms are you using?

Posted: Sat Sep 14, 2019 2:36 am
by mathjak107
sophie wrote:
Fri Sep 13, 2019 7:52 am
Good, instructive story, mathjak.

I use both Vanguard and Fidelity, along with a conventional brick and mortar bank (Chase). I originally was all in Fidelity, but ended up opening an individual brokerage at Vanguard to go along with my employer retirement accounts there, and to take advantage of some Vanguard funds that are far superior to their counterparts at Fidelity (treasury money market and small cap value). If either of them were to be locked up, I'd be able to manage with funds in the other brokerage plus the Chase account.

Fidelity and Vanguard complement each other nicely, I find. Fidelity wins on customer service, the HSA, the powerful cash management and multiple-account setup, and investing in individual Treasuries. Vanguard wins on fees.
actually i have fidelity index funds that are zero fees .. that beats vanguards low fee.

jack bogle and vanguard have said a lot of things and then contradicted themselves ... first the grand pappy of do it yourself investing sold us on how anyone can invest like the pro's and get better results ...then vanguard gets in to money mgmt and releases a study that shows the typical investor can earn as 3% more by letting a money manager handle their money keeping them away from it .
then they deleted all our beneficiaries from joint accounts and told us we would be better served by trusts ... yep vanguard was promoting its trust dept they now had .
but wait , now vanguard is telling us how their managed funds out perform ---yep you guessed it , now they are promoting actively managed funds ...
https://investor.vanguard.com/mutual-fu ... ly-managed

and this is why i cut them out .

Re: How many brokerage firms are you using?

Posted: Sat Sep 14, 2019 9:52 am
by shekels
Kriegsspiel wrote:
Fri Sep 13, 2019 8:08 pm
How many of you dialed 1-800-5-FRANCE

Age test.
"1-800-5-FRANCE" Did not dial that one.

Come to think of it.
Do you have Prince Albert in a Can? ^-^

Also Fidelity sure does have a lot of Commission FREE ETF.
https://etfdb.com/type/commission-free/fidelity/

Better than 40 Dollar Trades

Re: How many brokerage firms are you using?

Posted: Sat Sep 14, 2019 10:07 am
by dualstow
if I could nitpick the above previous page a little bit, mathjak:

Fees: both houses are really good, and far cheaper than they used to be.
*Treasurys trade for free at both.
*Both offer free trades of their in-house funds and ETFs. At fidelity, that also includes iShares.
Stock trading depends on how much money you keep at Vanguard (free at the highest level) and is a flat $4.95 per transaction at Fidelity. Very recently it was 6.95 and 8.95.

The expense ratios of index funds are always decreasing, but they’re both really close. For the broad market, practically zero. I mean, F’s was 0.04% when V’s was still 0.03%. So you’d save $100 on every million. O0

Change in philosophy: I don’t know if Jack Bogle contradicted himself, but he hadn’t been at the helm of Vanguard for a long time by the time he passed away. And V had definitely moved in a different direction. Example: international bonds in the target retirement funds. Another example: the infatuation with ETFs. (By the way, didn’t pug or kbg write something about the structure of ETFs and why he held them instead of funds at fidelity?)

The main change with Bogle is that he was holding stocks and bonds with a 50/50 ratio and not ‘age in bonds.’ When you have that much money, does it really matter? But, other than that I don’t think he really strayed. Of course, Vanguard has pressure to change with the times. People want ETFs.

That beneficiary thing, though- terrible. No excuse for it. I’m grateful that you had alerted us to it.

Re: How many brokerage firms are you using?

Posted: Sat Sep 14, 2019 1:07 pm
by mathjak107
i use mostly managed fidelity funds which have outperformed indexing for the 30 years i have been an investor , but i do own some index etf's .. i gave the new fidelity zero expense index fund a shot too .. it is a slightly different index than the standardized ones . they would have to pay for the use of the standardized index's so to keep it free they have their own modified version of a total market index and s&p 500 index. they do not have to pay for the use of the index so they can keep it zero expense

Re: How many brokerage firms are you using?

Posted: Sat Sep 14, 2019 1:27 pm
by dualstow
What's the ticker?

Re: How many brokerage firms are you using?

Posted: Sat Sep 14, 2019 7:19 pm
by mathjak107
Fzrox

Re: How many brokerage firms are you using?

Posted: Mon Sep 16, 2019 10:54 am
by pmward
mathjak107 wrote:
Sat Sep 14, 2019 7:19 pm
Fzrox
I have a bunch in this as well in my IRA's. So far it's tracked the "official" indexes very well. The only thing to watch out for was some short term cap gains last year, which is why I don't hold it in taxable.

Re: How many brokerage firms are you using?

Posted: Tue Sep 17, 2019 4:23 am
by mathjak107
i try not to hold much in equities in a taxable account ... as michael kitces points out , that special lower capital gains rate we think we are getting tends to evaporate over long periods of time with as little as a 2% dividend being distributed compared to having it in a tax advantaged account ..

with interest rates so low it is silly to keep bonds in a deferred account taking up valuable tax deferred compounding space . the bonds are taxed at regular rates anyway .

Re: How many brokerage firms are you using?

Posted: Tue Sep 17, 2019 7:58 am
by sophie
It's not all about the expense ratio. I think there's some behind the scenes activity that affects fund performance that isn't necessarily reflected in the ER. For example, FSKAX has consistently lagged VTSAX and also its benchmark index by more than the difference in ER.

Also news flash: Fidelity finally has a low-ER small cap value index fund!!!! FISVX. ER is 0.05, which beats Vanguard's 0.07 (and completely blows away IJS). It's too early to judge performance, for which see above.

In which case Vanguard's main advantage comes down to the Treasury-only money market. Fidelity can't match that one. The ER of its equivalent fund is 0.42%!!!

Re: How many brokerage firms are you using?

Posted: Tue Sep 17, 2019 8:25 am
by dualstow
sophie wrote:
Tue Sep 17, 2019 7:58 am
For example, FSKAX has consistently lagged VTSAX and also its benchmark index by more than the difference in ER.
I did not know that! Interesting, because I hold both. I have my wife in ITOT (1500 stocks only), an iShares product. Maybe I should compare its performance to FSKAX (over 3000), but if I switch, it could be ill-timed. Not that she would notice.

Re: How many brokerage firms are you using?

Posted: Tue Sep 17, 2019 8:39 am
by sophie
dualstow wrote:
Tue Sep 17, 2019 8:25 am
sophie wrote:
Tue Sep 17, 2019 7:58 am
For example, FSKAX has consistently lagged VTSAX and also its benchmark index by more than the difference in ER.
I did not know that! Interesting, because I hold both. I have my wife in ITOT (1500 stocks only), an iShares product. Maybe I should compare its performance to FSKAX (over 3000), but if I switch, it could be ill-timed. Not that she would notice.
Yup I noticed that a while back. It's when I started thinking about building up a basket of stocks to complement the index funds. Now that they've hit the big time, I expect there will be more behind the scenes shenanigans that we'll be reading about one day in the Wall Street Journal.

Re: How many brokerage firms are you using?

Posted: Tue Sep 17, 2019 9:13 am
by Kbg
Small note...if one is going to invest in a small cap index fund, recommend something based on the S&P 600 or other "crap filter" type small cap index. The R2K is not a good index for small caps.

Re: How many brokerage firms are you using?

Posted: Tue Sep 17, 2019 1:30 pm
by mathjak107
not all index funds do the same things like some loan out securities ... spy is one of the few pure ones ..ivv is not

Re: How many brokerage firms are you using?

Posted: Tue Sep 17, 2019 4:13 pm
by Smith1776
Indeed I remember Swedroe remarking that filtering out the junk or "lottery ticket" stocks from a portfolio, particularly of small caps, greatly improved results. Removing these crappy securities even from total market indexes seemed to improve the portfolio across the board.

Interestingly, one way to filter out the junk from small caps is to simply tilt towards value.

As you all know, if I tilt towards value I'm getting low P/E, P/B, P/CF ratios etc. Having a low P/E necessitates having some earnings. Crappy securities tend to get filtered out when there's no cash flow or earnings (no p/e and p/cf at all). So there's actually a quality/profitability tilt that's built in.