Master list of PP component ETF/MFD options

[craigr]

If you can hold the bonds directly that is always better. The t-bills it depends. If you want to build your own treasury ladder many brokerages have bond tools that can help. If not, then the funds are an easy and convenient way to go.

[MachineGhost]

Of the gold ETFs, none are really officially sanctioned, but they are better than not owning the asset if give a choice.

Out of the sorry lot of gold ETFs, I recommend the ZKB Gold ETF.  This ETF represents direct ownership in physical payable gold bullion bars backed by Zurcher Kantonalbank which is owned and managed by the largest canton (state equivalent) in Switzerland, i.e. government backed.  The ticker is ZGLDUS.SW at Yahoo or ZGLDUS on the Swiss Exchange (other currenceis also available).

Info: http://www.six-swiss-exchange.com/funds ... 101593CHF4

MG

[craigr]

Of the gold ETFs, none are really officially sanctioned, but they are better than not owning the asset if give a choice.

Out of the sorry lot of gold ETFs, I recommend the ZKB Gold ETF.  This ETF represents direct ownership in physical payable gold bullion bars backed by Zurcher Kantonalbank which is owned and managed by the largest canton (state equivalent) in Switzerland, i.e. government backed.  The ticker is ZGLDUS.SW at Yahoo or ZGLDUS on the Swiss Exchange (other currenceis also available).

Info: http://www.six-swiss-exchange.com/funds ... 101593CHF4

MG

I don't think US residents can buy that etf. Though for non US persons that is the etf I would recommend.

[MachineGhost]

I don't think US residents can buy that etf. Though for non US persons that is the etf I would recommend.

Sure we can.  If the broker doesn't offer trading on the Swiss Exchange, its the broker's fault.  Its all a question of will.

MG

[BearBones]

Here's a breakdown of what I'd do if I only wanted to use funds:
Stock - VTI, IWV, SPY or IVV

Thanks, Craig. Here's more info on the equity ETFs:
          ER    Vol
VTI    .06  1.9k
IWV    .2    .4k
SPY    .09  197k 
IVV    .09  3.7k

So, for me, IWV is out, I guess. How to sort out if the higher trading volume of SPY justifies it over VTI which otherwise has a broader market cap and a tad lower expense?

And are there any advantages in Vanguard's MFs over their ETFs (e.g., VTI), especially if one can get Admiral Shares?

[craigr]

Here's a breakdown of what I'd do if I only wanted to use funds:
Stock - VTI, IWV, SPY or IVV

Thanks, Craig. Here's more info on the equity ETFs:
          ER    Vol
VTI     .06  1.9k
IWV    .2     .4k
SPY    .09  197k   
IVV    .09   3.7k

So, for me, IWV is out, I guess. How to sort out if the higher trading volume of SPY justifies it over VTI which otherwise has a broader market cap and a tad lower expense?

And are there any advantages in Vanguard's MFs over their ETFs (e.g., VTI), especially if one can get Admiral Shares?

Vanguard mutual funds that have an ETF ticker equivalent are linked together. They are identical. The ETF is a share class of the fund. It is unique in the industry and gives them tax advantages for fund holders because they can use the ETF as an outlet to get rid of less tax efficient trades on the market.

Buy the broad based fund if you can. Vanguard total stock market is the top dog. IMO.

[Sandoor]

Here are some suggestions for European PP holders. Not sure if you can fit them into your list.
I advise European PP holders to focus on Germany for the cash and bonds part so that's what I based my suggestions on.

Cash:
EXVM: eb.rexx Government Germany Money Market
EXHB: eb.rexx Goverment Germany 1.5-2.5

Gold:
PHAU: ETFS Physical Gold
XOB1: RBS Physical Gold

Long Bonds:
EXX6: eb.rexx® Government Germany 10.5+

Equity:
DXET: db-Xtracks Euro Stoxx 50 (Acc)
EUEA: Ishares Euro Stoxx 50
IMEU: Ishares MSCI Europe

There is a lot more to say about this topic and I actually did last week on my blog. Unfortunately it is on Dutch so a bit hard to share here, but for those who can understand Dutch, please read it here http://www.indexvolger.nl/2012/02/de-pe ... e-praktijk.

[jco]

Is anyone else finding this useful? I do and would like to keep it thorough and up-to-date.

But keeping it up is some extra work... Thanks to people who fix/add.

[KevinW]

Is anyone else finding this useful? I do and would like to keep it thorough and up-to-date.

Yes. It's been a while since I had anything to add, though.

[MediumTex]

Is anyone else finding this useful? I do and would like to keep it thorough and up-to-date.

Yes. It's been a while since I had anything to add, though.

I put a sticky on it.

[rnmike10]

Dear Craig R,

You recommend the (Vanguard) MF's vs. the identical ETF's, is there a reason? (if i have my broker account with Vanguard and the ETF's trade free)

[craigr]

Dear Craig R,

You recommend the (Vanguard) MF's vs. the identical ETF's, is there a reason? (if i have my broker account with Vanguard and the ETF's trade free)

No commissions to buy the funds and the fund buy price is settled at market close. ETFs not only have commissions but also bid/ask spreads to worry about.

[KevinW]

My employer's brokerage window is switching to Aon Hewitt Financial Services, so I took the time to comb through their monster list of no-transaction-fee mutual funds. I found about a dozen mediocre PP-compatible funds. Should I post them here; or would you like me to enter them directly into the Google Doc?

[j831526]

Here's a breakdown of what I'd do if I only wanted to use funds:
Stock - VTI, IWV, SPY or IVV

Thanks, Craig. Here's more info on the equity ETFs:
          ER    Vol
VTI    .06  1.9k
IWV    .2    .4k
SPY    .09  197k 
IVV    .09  3.7k

So, for me, IWV is out, I guess. How to sort out if the higher trading volume of SPY justifies it over VTI which otherwise has a broader market cap and a tad lower expense?

And are there any advantages in Vanguard's MFs over their ETFs (e.g., VTI), especially if one can get Admiral Shares?

Vanguard mutual funds that have an ETF ticker equivalent are linked together. They are identical. The ETF is a share class of the fund. It is unique in the industry and gives them tax advantages for fund holders because they can use the ETF as an outlet to get rid of less tax efficient trades on the market.

Buy the broad based fund if you can. Vanguard total stock market is the top dog. IMO.

SCHB from Schwab now has an expense ratio of .04 nipping VTI by a skosh. Morningstar likes it - 5 star. I was surprised to see about 1% is in non-U.S. stocks and further surprised to see a similar statistic for VTI. Interesting!

[frugal]

Here are some suggestions for European PP holders. Not sure if you can fit them into your list.
I advise European PP holders to focus on Germany for the cash and bonds part so that's what I based my suggestions on.

Cash:
EXVM: eb.rexx Government Germany Money Market
EXHB: eb.rexx Goverment Germany 1.5-2.5

Gold:
PHAU: ETFS Physical Gold
XOB1: RBS Physical Gold

Long Bonds:
EXX6: eb.rexx® Government Germany 10.5+

Equity:
DXET: db-Xtracks Euro Stoxx 50 (Acc)
EUEA: Ishares Euro Stoxx 50
IMEU: Ishares MSCI Europe

There is a lot more to say about this topic and I actually did last week on my blog. Unfortunately it is on Dutch so a bit hard to share here, but for those who can understand Dutch, please read it here http://www.indexvolger.nl/2012/02/de-pe ... e-praktijk.

Is it still updated?


Thanks Sandoor

[jco]

This hasn't been updated in a while...

It needs work. Had some help from wizards earlier, like Akratic, but most people just come in and start editing it to their own devices and mess up the original.

Think the list will have to be locked and PM more for link to edit it.

Also, thinking that mutual funds should be dropped since their stats aren't working anyway... Perhaps MF and non-US countries could be listed in the OP or wiki.

[craigr]

The risk of a list like this is, as you point out, people start putting in things that may not be appropriate. I'm a little nervous about having something open to editing without some kind of control. I would hate to have newcomers read the list as if it were sanctioned, but to contain edits with funds that are not appropriate because someone put them there for their own personal reasons.

I'd rather have the list match up pretty much with what we have listed in the book in terms of funds. Then have some kind of super-mod of the data that will be responsible for putting in any new additions that the book didn't cover that are good candidates.

[KevinW]

The thing is, there are a lot of funds out there that are mediocre but maybe acceptable for PP purposes. E.g. the T Rowe Price stock index that just came up, and VUSTX. People will keep wondering about them and it'd be nice to record their specific faults once and for all.

I was thinking that what might be most helpful would be an expansive list of all funds that are acceptable, with numbered footnotes for objections to funds. E.g. (1) means ER too high, (2) is for bond funds that include non-Treasuries, (3) mean duration is too long for cash, etc. The short list of the best funds would be the ones with no footnoted objections. That list is probably identical to the list of funds recommended in the book.  Maintaining this kind of list only involves relaying information, not so much making judgment calls or giving advice.

Actually I've been meaning to add that kind of list to the PP page on the ERE wiki but just haven't got around to it.

[craigr]

Yes Kevin I totally agree. Perfect is the enemy of the good. You are right that a lot of funds people have may not be optimal, but are good enough compared to many alternatives.

Maybe we need some way to more clearly define the funds (our own star rating?) to people can sort by "Best" "Good" and "Acceptable" or some such?

[hoost]

My employer's brokerage window is switching to Aon Hewitt Financial Services, so I took the time to comb through their monster list of no-transaction-fee mutual funds. I found about a dozen mediocre PP-compatible funds. Should I post them here; or would you like me to enter them directly into the Google Doc?

Kevin,

I just caught this post that I apparently missed earlier.  I also have Aon Hewitt and never thought to look if they had no transaction fee mutual funds.  Did you end up making a spreadsheet with the results of your research?  If so, would you be willing to share the link?

[KevinW]

I just caught this post that I apparently missed earlier.  I also have Aon Hewitt and never thought to look if they had no transaction fee mutual funds.  Did you end up making a spreadsheet with the results of your research?  If so, would you be willing to share the link?

Their no transaction fee (NTF) list is here:
http://hewittfs.com/pdf/NTF_Fund_List.pdf

It's 65 pages long and the overwhelming majority of funds are high-expense, mediocre, active stock funds. I didn't make anything as sophisticated as a spreadsheet, just took some terse notes. Executive summary:

- There are many underwhelming stock index and short term Treasury funds. Only two long term bond funds and zero gold funds.

- T Rowe Price has the least expensive offerings in all 3 categories:
PREIX 0.30
PRULX .55
PRTXX 0.44
They all have a minimum investment of $2500.

- PRPFX is on the list and has a minimum of $1000.

If i had a plain Aon account I'd probably use PRPFX up to around $10,000; then a 4x25 using the T Rowe Price funds and a gold ETF. Somewhere around $50k it becomes cheaper to use 4 ETFs since the ER on those mutual funds starts to cost more than ETF trade commissions.

My employer's plan actually includes better options for stock and cash, and has some other policies to work around. So for now I am holding PRPFX, and later I will switch to using the built-in plan stock and cash funds, and Aon for TLT and IAU.

[KevinW]

Yes Kevin I totally agree. Perfect is the enemy of the good. You are right that a lot of funds people have may not be optimal, but are good enough compared to many alternatives.

Maybe we need some way to more clearly define the funds (our own star rating?) to people can sort by "Best" "Good" and "Acceptable" or some such?

Yeah, I agree that a rating scale like Best/Good/Acceptable is more workable than a binary yes/no answer.

One issue with that, though, is defining what the criteria for each rating are. For instance I believe that only US TSM funds are "best" for stock and only T-bill MMFs are "best" for cash. But many here seem comfortable with ex-US stocks or longer duration bonds in cash. High ERs are a bigger problem for large accounts than small ones. Which is why I was leaning toward only enumerating the objections, so everyone can decide for themselves which objections are deal-killers for themselves.

Then again, maybe the people looking at these lists actually want someone else to make some of those judgment calls for them.

[hoost]

I just caught this post that I apparently missed earlier.  I also have Aon Hewitt and never thought to look if they had no transaction fee mutual funds.  Did you end up making a spreadsheet with the results of your research?  If so, would you be willing to share the link?

Their no transaction fee (NTF) list is here:
http://hewittfs.com/pdf/NTF_Fund_List.pdf

It's 65 pages long and the overwhelming majority of funds are high-expense, mediocre, active stock funds. I didn't make anything as sophisticated as a spreadsheet, just took some terse notes. Executive summary:

- There are many underwhelming stock index and short term Treasury funds. Only two long term bond funds and zero gold funds.

- T Rowe Price has the least expensive offerings in all 3 categories:
PREIX 0.30
PRULX .55
PRTXX 0.44
They all have a minimum investment of $2500.

- PRPFX is on the list and has a minimum of $1000.

If i had a plain Aon account I'd probably use PRPFX up to around $10,000; then a 4x25 using the T Rowe Price funds and a gold ETF. Somewhere around $50k it becomes cheaper to use 4 ETFs since the ER on those mutual funds starts to cost more than ETF trade commissions.

My employer's plan actually includes better options for stock and cash, and has some other policies to work around. So for now I am holding PRPFX, and later I will switch to using the built-in plan stock and cash funds, and Aon for TLT and IAU.

Mine is probably the same as yours; I can only put my individual contributions into the brokerage window; all of the match that I get must be invested in one of the "core" funds.  I agree that the stock and cash funds are decent; those are the ones I use.  I had been using all ETF's in the brokerage window, but I may consider the T Rowe Price treasury fund; I also saw that Dreyfus has a treasury fund with a reasonable expense ratio, but I haven't dug into the prospectus yet.  I'll probably start transitioning into one of those two funds for treasuries and stick with IAU for gold.  Thanks for the information.

[KevinW]

Yeah, IIRC Dreyfus had funds that were very similar to the T Rowe Price funds I listed above, but with slightly higher ERs. Please let me know if you see anything surprising in the prospectuses, I didn't go that deep. It might also be worth looking into
RidgeWorth US Gov Sec Ultra-Short Bd I (SIGVX)
which has a slightly lower ER of 0.39.