How do you set up automatic investment in to VG ETFs?

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Gamma Ray
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How do you set up automatic investment in to VG ETFs?

Post by Gamma Ray » Thu Jun 07, 2018 10:59 pm

It's only giving me option to fund the Vanguard Federal Money Market Fund (Settlement fund) via auto investments.
This is taxable account.

Once I set this, can I set up another auto investment from Settlement Fund into the ETF, VOO for example to be done 1 day after auto investment/transfer from my checking to settlement fund?

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Alexa9
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Re: How do you set up automatic investment in to VG ETFs?

Post by Alexa9 » Thu Jun 07, 2018 11:03 pm

I don't think you can with ETF's due to trading policy (bid/ask spread and volume). You can with mutual funds. Or you can use good until cancelled limit orders maybe.

AlohaJoe
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Re: How do you set up automatic investment in to VG ETFs?

Post by AlohaJoe » Thu Jun 07, 2018 11:25 pm

Obviously it is possible to do automatic purchasing of ETFs (I mean, that's what algorithmic trading is) but few retail platforms make it easy. You can't do it at Vanguard and will need to move somewhere else. I think (but am not sure) that places like Robinhood, Acorns, and M1 do it.

ivk5
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Re: How do you set up automatic investment in to VG ETFs?

Post by ivk5 » Fri Jun 08, 2018 3:20 am

Workaround: you can auto-invest in the corresponding MF share class, then periodically call VG and have them convert the MF shares to ETF shares.

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ruralavalon
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Re: How do you set up automatic investment in to VG ETFs?

Post by ruralavalon » Fri Jun 08, 2018 10:34 am

Gamma Ray wrote:
Thu Jun 07, 2018 10:59 pm
It's only giving me option to fund the Vanguard Federal Money Market Fund (Settlement fund) via auto investments.
This is taxable account.

Once I set this, can I set up another auto investment from Settlement Fund into the ETF, VOO for example to be done 1 day after auto investment/transfer from my checking to settlement fund?
Why not just use traditional mutual funds instead?
"Everything should be as simple as it is, but not simpler." - Albert Einstein | Wiki article link:Getting Started

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Gamma Ray
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Re: How do you set up automatic investment in to VG ETFs?

Post by Gamma Ray » Fri Jun 08, 2018 1:04 pm

ruralavalon wrote:
Fri Jun 08, 2018 10:34 am
Gamma Ray wrote:
Thu Jun 07, 2018 10:59 pm
It's only giving me option to fund the Vanguard Federal Money Market Fund (Settlement fund) via auto investments.
This is taxable account.

Once I set this, can I set up another auto investment from Settlement Fund into the ETF, VOO for example to be done 1 day after auto investment/transfer from my checking to settlement fund?
Why not just use traditional mutual funds instead?

I bought ETFs under taxable just one the side in the beginning and I didn't want to open yet another account, more splits in VG accounts view (which is already cluttered and not the most intuitive) but if opening a new account and funding a MF is the only way to get auto-invest function, I may have to do it. Do people not invest regularly on their taxable accounts? Is that not a common practice?

It probably makes it very difficult to TLH since you have too many purchases if you do this weekly or twice a week, right? If it creates a headache, I don't mind setting up auto-pay to my brokerage settlement account, so the funds are ready for investment, and logging in monthly to buy funds manually.

onourway
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Re: How do you set up automatic investment in to VG ETFs?

Post by onourway » Fri Jun 08, 2018 1:08 pm

You don't need to open another account to own mutual funds - you can own both side-by-side at Vanguard. So keep your existing ETF's. Make automatic purchases of the mutual fund.

I primarily own mutual funds at Vanguard (because their tax-efficiency is the same as the ETF) and invest monthly automatically. I also have funds at Schwab, but buy ETF's there because their mutual funds are not as tax efficient. An automatic purchase happens every month on the 1st at Vanguard. If I have extra money during the month to invest, it often goes to Schwab.

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Gamma Ray
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Re: How do you set up automatic investment in to VG ETFs?

Post by Gamma Ray » Fri Jun 08, 2018 3:08 pm

Thanks, I'll start with a small account to see how it works. I didn't want to create more funds than needed but if I it's the only way to get auto invest to work, I'll do it.

I still have to evaluate how much I can save and review my portfolio.

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