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free trade @ Scottrade, Focus Morningstar US Market Index ETF FMU
Posted: Mon May 16, 2011 1:34 pm
by murphy_p_t
this is a new ETF, with lower expense ratio than VTI. i haven't done any due diligence on this yet. its new (less than 2 months)
free trades at scottrade.
any thoughts / concerns?
Re: free trade @ Scottrade, Focus Morningstar US Market Index ETF FMU
Posted: Mon May 16, 2011 2:00 pm
by AdamA
Some of the smaller ETF's are structured different than the larger ones. I'm not sure of the exact details, but the larger ones actually own all of the stocks...I think the smaller ones track the index, but may not actually own the stocks...I can't remember where I was reading about this...
Re: free trade @ Scottrade, Focus Morningstar US Market Index ETF FMU
Posted: Tue May 17, 2011 8:54 pm
by AgAuMoney
Watch out for liquidity costs. In other words, with a smaller and less frequently traded etf the bid/ask spread (your buy/sell costs) might cost you significantly more than the $14 ($7*2) commission scottrade will charge to buy and sell VTI.
Watch out for maintenance costs. In other words, the cost (expense ratio) to hold the scottrade etf might be more than the cost to hold VTI and you'll end up spending more than the $14 commission you save.