Bogleheads

[SoonerSunDevil]

There have been several questions and threads regarding Wells Fargo's discount brokerage, WellsTrade. I moved from my previous broker exactly two weeks ago, and all of my positions are already showing in my WellsTrade accounts.

The customer service from Wells Fargo has been excellent, the execution speed with respect to purchasing ETFs has been great (saw a couple price improvements), and the selection of mutual funds available for purchase are outstanding.

I know many posters here have accounts with Vanguard and with Vanguard only. You might be wondering why I would open up a discount brokerage account, especially at a place other than Vanguard. Since I qualify for Wells Fargo's PMA Package, I get 100 free trades per year, per account. I have an individual account, Roth IRA, Traditional IRA, and soon enough I'll have to open a Rollover IRA account with them. I have 100 free trades per year for each of these three accounts. These free trades cover mutual fund, ETF, and stock transactions. I won't even come close to using 100 free trades, but it's nice to know that I have the ability to trade that often for free should the need (tax-loss harvesting) ever arise.

In my portfolio I have a mixture of funds from Vanguard, Dodge and Cox, Fidelity, and I hold a couple of ETFs. Instead of having an account with Vanguard, another with Fidelity, and another with Dodge and Cox, I am using WellsTrade (for free) for the simplicity of having all of my assets in one place.

Some posters have brought up the concern regarding the low interest rates paid by Wells Fargo on cash balances. It's quite simple to avoid earning a paltry rate of interest by placing an order to purchase Vanguard's Prime Money Market fund, ticker VMMXX. There's no fee for this, and after placing the trade, I have 99 more free trades left to use.

For those Bogleheads that are considering leaving their discount broker, I highly recommend WellsTrade. For those that are looking to open a brokerage account with cheap ETF trades, WellsTrade is free if you qualify for the PMA Package. Here are the details on the PMA package:

https://www.wellsfargo.com/investing/styles/wt/

I hope this post helps some Bogleheads who are considering WellsTrade.

John

[DaveTH]

I have been using WellsTrade for nearly a year to dollar-cost average into ETFs. I use the Russell Institutional Money Market fund (RMMXX) for idle cash. I have been very pleased so far.

[livesoft]

Did you notice how they even got all your purchases and dates for those assets that you transferred "in-kind"? This will be helpful when you need to know the cost basis when you sell.

[Diver]

[heyyou]

Diver,
Yes you can rollover into an existing traditional IRA. A rollover IRA is not really a subcategory of traditional IRAs, it is just a label to denote the origin of it since the balance is usually more than the limit for annual contributions. The IRS treats all traditional IRAs the same.

[Diver]

[kal]

Did your previous broker charge you for the transfer?

[SoonerSunDevil]

[SoonerSunDevil]

[Peanut]

I know that some brokerage accounts charge you a transaction fee for buying a mutual and some don't, they usually list these for you. I used the link at WellsFargo to look up thier no transaction fee list of mutual funds. I noticed that Vanguard was not on that list. So, while you get one hundred free trades, there is still a transaction fee to be charged. So if you ever want to buy a new mutual fund with Vanguard through WellsFargo you will not pay a trade fee but you will pay a transaction fee.

Am I wrong?

-Peanut
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"One hundred men will test today, but only three, win the..."

[SoonerSunDevil]

[Peanut]

Yeah, that helps a lot. I use USAA and love them. But for whatever the reason Vanguard is not a no transaction fee company for them. But even with my free trades they still charge the transaction fee. I could not wrap my mind around it. They told me it is becuase they worked out a deal with the companies that they list as NTF and Vanguard was not one of them, hence, the TF. I like the way WellsFargo looks at it. Whether the compay charges a TF or not, if you have a free trade, then you pay nothing. I am goint to have to have a talk with USAA again and see about all this.

Thanks for the info.

-Peanut
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"One hundred men will test today, but only three, win the..."

[indexfundfan]

I have the Wellstrade account for a little over a year and overall I have been pleased too. I just hope that the good things (i.e. the free trades) do not come to an end...
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My signature has been deleted.

[SoonerSunDevil]

[Peanut]

Dude, your telling me. The transaction fee starts out at forty-five dollars and can increase with the amount of money you are using to purchase the fund. The more money the higher the fee can go up. The thing they told me though is that it is not them that charges it but Vanguard. They said they would rather have all NTF funds but not every company was willing to work out a deal or something. I will have to call during next working hours to find this out.

But thanks again for the tip about WellsFargo, I will definitely keep them in mind.

-Peanut
_________________
"One hundred men will test today, but only three, win the..."

[Peanut]

Oh yeah, by the way, Hook'em Horns!!!
_________________
"One hundred men will test today, but only three, win the..."

[SoonerSunDevil]

[SoonerSunDevil]

[SoonerSunDevil]

[pointyhairedboss]

[pointyhairedboss]

[Bounca]

[LH2004]

[livesoft]

I can't imagine TDAmeritrade making any money off of my account.

I have a 6-figure account at TDAM of about 4 ETFs and 3 stocks. I have made no trades in 2 years. The day a dividend appears in my cash sweep account, it gets ACH-transferred out to my WF account, thus keeping my cash balance at TDAM at $0. TDAM should make a little money off the 'float', but that can't pay for the paperwork I get mailed from them each year (proxies, 1099s).

There must be some benefit to brokers to have customer assets. Maybe they can loan out my ETFs/stocks and that helps them?

[Fantumzone]

If I'm interpreting the wells fargo offer correctly, I can have 0$ in checking and savings, and 25K in say VMMXX in their brokerage, and qualify for their 100 free trades, is that correct ?

Also, on 100 free trades per account, do I need to have a seperate username etc for the different accounts, or is it like vanguard where there is one username, just seperate sub-accounts ?
This is because they say IRA accounts will be included in the 25k qualification.

My question then is, say I have 10k in VMMXX in taxable account, and 15k in VIPSX in roth IRA at wells fargo, and nothing in checking and savings, will I get 200 free trades (100/accnt) per year ? And those trades can be for money market funds ?

[livesoft]

I became a WF customer because of their fantastic checking account. Only later did I become a brokerage customer when trades were low cost, but not free. Then they switched to free trades.

It has been reported that folks who keep $1 in checking and have no transactions get their account closed due to inactivity.

As for all the accounts, we have several accounts at WF: joint brokerage, his IRA, her IRA, joint checking, daughter's checking/savings. All are absolutely free. Online, I can see the joint accounts and my IRA. I cannot see my spouse's IRA. This is identical to my Vanguard online setup.

In my IRA at WF, I have the VG GNMA fund. I get 100 free trades in that account, but I have used only 1: the initial one to buy the VG GNMA fund. I am not going to trade in my IRA and dividends are reinvested for free, so I am not going to use the remaining 99 free trades in that account. And next year, I am not going to use the 100 free trades in that account. In theory though, I could sell the VG GNMA fund and buy a VG money market fund which would use up 2 free trades.

So don't get wrapped up in 100 free trades. WF is certainly a great deal, but would it be a better deal if they gave you 1000 free trades or unlimited free trades? Would it be a worse deal if they gave you 50 free trades?

And finally, I encourage you to call them up directly and experience their customer support before you open an account. See if they can answer your questions to your satisfaction.

[pointyhairedboss]

[pointyhairedboss]

[Sammy_M]

[SoonerSunDevil]

[Sammy_M]

I moved to Wellstrade recently and have been pleased for the most part. I did want to make others aware of one issue with transfering a PIMCO fund. I bought PCRIX at Vanguard BR where they have a $25k min. Before I decided to transfer my accts to Wellstrade I called them to make sure they could transfer it in because their minimum is $100k for this fund. I spoke with two people at Wellstrade who said it wouldn't be a problem. However, once I did the transfer -- It wouldn't go through b/c PIMCO would not let Wellstrade setup the acct to transfer into. I finally got in touch with someone at PIMCO and they made an exception. Just took tons of time (4-6hrs total) and wanted to warn others of this situation.

[SoonerSunDevil]

[Default User BR]

[Default User BR]

[LH2004]

[expat]

Does the 100 free trade apply to their solo 401K plan too?

[Kenster1]

[Sammy_M]

[azap]

I'm guessing that the answer is no, but I'm asking to be sure. If you hold Vanguard Prime Money Market in a WellsTrade account, do you get a checkbook to write checks from the account? I realize that you can transfer funds to your Wells Fargo checking, but that would use up a trade. I'm considering starting a WellsTrade account, but I may need to maintain a money market account outside (or a Wells Fargo money market account within) to maintain checkwriting from the money market.

[tibbitts]

I thought that to retail the capability to roll a rollover back into an employer plan, you had to maintain the funds in a separate ira account. So only one ira would not suffice for someone with multiple ira fund sources. Maybe someone can clarify.

Paul

[paulob]

[LH2004]

[schwarm]

[DaveTH]

[paulob]

[schwarm]

[livesoft]

I had a TDWaterhouse Bank checking account for almost a decade without having any branches nearby. I did all the traditional banking activities without having a place to walk into for that decade. I got a mortgage, refinanced a couple of times, etc. I would still be using this bank if they had not severed their relationship with Ameritrade.

The WF online brokerage account is not run out of the local WF offices. Indeed, the brokers in the local offices cater to folks who want hand-holding and pay high fees. If you go into the office and try to get help on the free-trade brokerage stuff, they will stick their noses up at you and kick you out on the curb.

But the PMA checking is not the brokerage. The folks in the local bank will do nice things for you if you have PMA checking. Nice things like free cookies, no holds on big checks, etc.

Anyways, IMHO one doesn't need a local bank in this modern age.

[Kenster1]

Yes -- I guess Paulob was the example I was thinking of.

You should have no problems with Welltrade in using their service via fax, mail-in or phone orders. The problem is that to qualify for the 100 free trades, everything is tied to opening a PMA Bank account which is on the Well Fargo banking side of the business.

When Paulob's son ran into a snafu with trying to be added to the PMA bank account in order to qualify for the 100 free trades in Wellstrade -- WF bank asked him to visit a branch I guess to validate identity.

Most of the time everything should run smoothly with Wellstrade but am a bit concerned about little circumstances like this that Paulob's son ran into irregardless of whether you want to make use of your PMA bank account or not.
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SURGEON GENERAL'S WARNING: Any overconfidence in your ability, willingness and need to take risk may be hazardous to your health.

[Sammy_M]

[LH2004]