Best way to "sell" fund no longer want

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Topic Author
soazfree
Posts: 63
Joined: Fri Sep 04, 2015 8:49 pm

Best way to "sell" fund no longer want

Post by soazfree »

I'm looking for advice on the best way to "sell" my Fid New Market shares (FNMIX) that has a higher expense ratio and allocate the amount to my three fund portfolio. Ideally I want to be able sell it all down to the last cent and no longer have any FNMIX in my account. Do I just sell it all to my money market account and then after a couple days buy my three funds, or is there a more elegant way? Thank you
DSInvestor
Posts: 11383
Joined: Sat Oct 04, 2008 11:42 am

Re: Best way to "sell" fund no longer want

Post by DSInvestor »

I assume you're holding the fund at Fidelity. When you trade, the action drop down gives you several options:
1 Buy
2 Sell shares
3 Sell All shares
4 Sell and use proceeds to buy another (dollars)
5 Sell and use proceeds to buy another (shares)
6 Sell all and use proceeds to buy another
7 specific shares.

You can avoid time out of market by using one of the options that sell and use proceeds to buy another. If the "sell all and use proceeds to buy another" does not allow you to direct the proceeds to multiple funds, you may need to 3 sell transactions. The last transaction would be to "sell all and use proceeds to buy another"
Last edited by DSInvestor on Wed Mar 29, 2017 3:20 pm, edited 1 time in total.
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Lou354
Posts: 680
Joined: Sun Apr 03, 2016 10:51 pm

Re: Best way to "sell" fund no longer want

Post by Lou354 »

Exchange $X to fund 1, $Y to fund 2, and then 100% to fund 3.
DSInvestor
Posts: 11383
Joined: Sat Oct 04, 2008 11:42 am

Re: Best way to "sell" fund no longer want

Post by DSInvestor »

If you hold this fund in a tax advantaged account like an IRA or 401k, there would be no tax consequences for selling the fund. If you hold this fund in a taxable account, be aware that net capital gains are taxable. Check the cost basis for the holding before selling. The higher AGI with the capital gain may impact how much social security is taxed and ACA premium tax credit.
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robertalpert
Posts: 455
Joined: Wed Aug 22, 2007 10:09 pm

Re: Best way to "sell" fund no longer want

Post by robertalpert »

Just be sure you have held all shares of FNMIX for 91 days or more. There is a 1% redemption fee if held less than 90-days.
Topic Author
soazfree
Posts: 63
Joined: Fri Sep 04, 2015 8:49 pm

Re: Best way to "sell" fund no longer want

Post by soazfree »

Thanks all, sorry for not providing a bit more clarity to my situation;

1. Account is with Vanguard
2. It is tax advantaged
3. Yes I've had it more than 91 days, in fact that's why I have it because when I left my adviser and went to the three fund approach, I hadn't held for more than 90 days, so kept it and had it in addition to my three fund
Topic Author
soazfree
Posts: 63
Joined: Fri Sep 04, 2015 8:49 pm

Re: Best way to "sell" fund no longer want

Post by soazfree »

Sorry, one more question/comment

When I'm on the VG page, it doesn't look like I can exchange a Fido fund and buy VG funds (only lets you choose other Fido funds)

What isn't clear to me is if I elect to sell all of the FNMIX, does that money go into my settlement fund that I can then use to buy my "3 Fund" funds, or do they send me a check? My concern is that I don't to create a taxable event etc.

Thanks
mhalley
Posts: 8514
Joined: Tue Nov 20, 2007 6:02 am

Re: Best way to "sell" fund no longer want

Post by mhalley »

Unless you specify otherwise, it will go into the settlement fund, then when it clears you can buy the vanguard funds.
If it is in a taxable account, it will be a taxable event. It would be a taxable event if you exchanged to another fidelity fund. But you say it is in tax advantaged account, so no taxes.
Topic Author
soazfree
Posts: 63
Joined: Fri Sep 04, 2015 8:49 pm

Re: Best way to "sell" fund no longer want

Post by soazfree »

mhalley wrote:Unless you specify otherwise, it will go into the settlement fund, then when it clears you can buy the vanguard funds.
If it is in a taxable account, it will be a taxable event. It would be a taxable event if you exchanged to another fidelity fund. But you say it is in tax advantaged account, so no taxes.
Thank you :beer
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