How do I go about buying the SPY ETF at Fidelity?

Have a question about your personal investments? No matter how simple or complex, you can ask it here.
Post Reply
Topic Author
thelateinvestor43
Posts: 166
Joined: Fri Nov 15, 2019 2:02 am
Location: Westbrook, Maine

How do I go about buying the SPY ETF at Fidelity?

Post by thelateinvestor43 » Mon Dec 02, 2019 8:23 am

Is buying an ETF that much different from buying a mutual fund?

I have no idea how I would go about purchasing, for example, the SPY ETF for my brokerage with the $2500 I just transferred.

Can someone show me the steps?

I heard that you have to bid/sell or something?

Confused.

User avatar
Vulcan
Posts: 1025
Joined: Sat Apr 05, 2014 11:43 pm

Re: How do I go about buying the SPY ETF at Fidelity?

Post by Vulcan » Mon Dec 02, 2019 8:25 am

If you torture the data long enough, it will confess to anything. ~Ronald Coase

clip651
Posts: 472
Joined: Thu Oct 02, 2014 11:02 am

Re: How do I go about buying the SPY ETF at Fidelity?

Post by clip651 » Mon Dec 02, 2019 8:33 am

Mutual funds are much simpler to deal with than ETFs for a new investor. The buy transactions are much easier. Don't make things more complex when you are just starting out and learning, keep it simple. Investing doesn't need to be complicated.

livesoft
Posts: 68562
Joined: Thu Mar 01, 2007 8:00 pm

Re: How do I go about buying the SPY ETF at Fidelity?

Post by livesoft » Mon Dec 02, 2019 8:39 am

thelateinvestor43 wrote:
Mon Dec 02, 2019 8:23 am
Is buying an ETF that much different from buying a mutual fund?

I have no idea how I would go about purchasing, for example, the SPY ETF for my brokerage with the $2500 I just transferred.

Can someone show me the steps?

I heard that you have to bid/sell or something?

Confused.
I put a screen capture in this post yesterday: viewtopic.php?p=4866458#p4866458
You click on the "Trade" button.

My advice for you is to avoid buying SPY and buy something better.
Wiki This signature message sponsored by sscritic: Learn to fish.

Topic Author
thelateinvestor43
Posts: 166
Joined: Fri Nov 15, 2019 2:02 am
Location: Westbrook, Maine

Re: How do I go about buying the SPY ETF at Fidelity?

Post by thelateinvestor43 » Mon Dec 02, 2019 8:53 am

clip651 wrote:
Mon Dec 02, 2019 8:33 am
Mutual funds are much simpler to deal with than ETFs for a new investor. The buy transactions are much easier. Don't make things more complex when you are just starting out and learning, keep it simple. Investing doesn't need to be complicated.
Yeah maybe I'll stick with them for now. I won't pay Capital gains in the taxable anyways, cause I'm in the 12% bracket. Just State and Federal on income.

User avatar
MrBobcat
Posts: 297
Joined: Fri Jan 11, 2019 5:19 pm

Re: How do I go about buying the SPY ETF at Fidelity?

Post by MrBobcat » Mon Dec 02, 2019 9:01 am

clip651 wrote:
Mon Dec 02, 2019 8:33 am
Mutual funds are much simpler to deal with than ETFs for a new investor. The buy transactions are much easier. Don't make things more complex when you are just starting out and learning, keep it simple. Investing doesn't need to be complicated.
It's not like buying ETFs is rocket science.

livesoft
Posts: 68562
Joined: Thu Mar 01, 2007 8:00 pm

Re: How do I go about buying the SPY ETF at Fidelity?

Post by livesoft » Mon Dec 02, 2019 9:11 am

MrBobcat wrote:
Mon Dec 02, 2019 9:01 am
clip651 wrote:
Mon Dec 02, 2019 8:33 am
Mutual funds are much simpler to deal with than ETFs for a new investor. The buy transactions are much easier. Don't make things more complex when you are just starting out and learning, keep it simple. Investing doesn't need to be complicated.
It's not like buying ETFs is rocket science.
Buying mutual funds is rocket science though. ETFs are like going to the grocery store and buying 6 ears of corn for 25 cents each or 5 pints of blueberries for $1.99 each. You can't buy corn nor blueberries if the store is not open. And you don't know what the price of the corn and blueberries are until the store opens.
Last edited by livesoft on Mon Dec 02, 2019 9:13 am, edited 1 time in total.
Wiki This signature message sponsored by sscritic: Learn to fish.

clip651
Posts: 472
Joined: Thu Oct 02, 2014 11:02 am

Re: How do I go about buying the SPY ETF at Fidelity?

Post by clip651 » Mon Dec 02, 2019 9:11 am

MrBobcat wrote:
Mon Dec 02, 2019 9:01 am
clip651 wrote:
Mon Dec 02, 2019 8:33 am
Mutual funds are much simpler to deal with than ETFs for a new investor. The buy transactions are much easier. Don't make things more complex when you are just starting out and learning, keep it simple. Investing doesn't need to be complicated.
It's not like buying ETFs is rocket science.
Nope, it's not. But for a complete newbie (look at OP's post history) it isn't necessary to tackle that learning curve right now.

And I am not a newbie, but having learned about both options, I still find mutual funds much simpler to deal with. With mutual funds, you have one price per trading day. You can invest round numbers, like $2500 easily. Can automate transactions if desired. Etc.

GrowthSeeker
Posts: 705
Joined: Tue May 15, 2018 10:14 pm

Re: How do I go about buying the SPY ETF at Fidelity?

Post by GrowthSeeker » Mon Dec 02, 2019 9:33 am

If you want to invest exactly $2,500 and you want to buy an ETF, say SPY, note that yesterday's closing price for SPY was $314.31. So $2,500 will theoretically buy about 7.95 shares. But you can't buy fractional shares of ETFs. Well, you can, I guess but it would be a rare thing; except for if you are reinvesting dividends, and the dividends buy a fractional amount of new shares. Also generally, most of the time, ETFs and stocks are purchased in round numbers of hundreds of shares. But 100 shares of SPY would cost, if you bought exactly at yesterday's close, $31,431 plus commission.

Mutual funds, OTOH, can be bought as "so many dollars worth", or "so many shares" (fractional is OK). Here one catch with a $2,500 purchase is that some mutual funds have a minimum amount for the initial purchase.
Vanguard's equivalent of SPY is VOO; and their equivalent mutual fund is VFIAX which has a minimum purchase of $3,000. I'm not sure what brokerage you're at, but I'm sure they have an S&P500 mutual fund, look that up to see what the minimum purchase is. Of course if you already have some of it, future additions can be any amount.
[Edit: Fidelity's 500 fund is FXAIX and has no minimum purchase, as another example]
Just because you're paranoid doesn't mean they're NOT out to get you.

GrowthSeeker
Posts: 705
Joined: Tue May 15, 2018 10:14 pm

Re: How do I go about buying the SPY ETF at Fidelity?

Post by GrowthSeeker » Mon Dec 02, 2019 9:47 am

thelateinvestor43 wrote:
Mon Dec 02, 2019 8:23 am
Is buying an ETF that much different from buying a mutual fund?

I have no idea how I would go about purchasing, for example, the SPY ETF for my brokerage with the $2500 I just transferred.

Can someone show me the steps?

I heard that you have to bid/sell or something?

Confused.
Explanation of "bid" and "ask"
When you buy or sell an ETF or a stock, the price of a share is constantly fluctuating while the market is open. At any given moment there is a bid price and an ask price. Just like when a street vendor opens his coat revealing a dozen watches and says, 'wanna buy a watch? I'm asking $50', then you say 'but I only want to pay $10'. The bid is $10, the ask is $50. (the "spread" is ask minus bid, or $40 in this weird example).
You can place the order in various ways. Two of these ways are: market order and limit order. If you place a market order, you'll get whatever the price is at that moment; probably more like the higher ask price. Or, you can place a market order at set the price to the maximum you're willing to pay. If you set that price very low, your trade probably won't execute. If you set it slightly below the current price, it will execute the next time the price bounces up and down and goes to or slightly below the limit price you set. It's a bit more complex than that, and more than 2 ways to place your order, but that's it in a nutshell.

btw, you can always call your brokerage and ask them to talk you through your first purchase. That's what I did the first time. Maybe the first few times.
Just because you're paranoid doesn't mean they're NOT out to get you.

User avatar
JoMoney
Posts: 7760
Joined: Tue Jul 23, 2013 5:31 am

Re: How do I go about buying the SPY ETF at Fidelity?

Post by JoMoney » Mon Dec 02, 2019 10:07 am

Fidelity has customer service numbers you can call for help:
https://www.fidelity.com/customer-servi ... s/overview

As well as comprehensive online tutorials and help/guides:
https://www.fidelity.com/trading/faqs-placing-orders
https://www.fidelity.com/learning-cente ... g/overview
https://www.fidelity.com/trading/faqs-about-account

I suggest you slow down and don't rush into making any purchases until you have a good understanding of what you're doing.
For what it's worth, I think a low-cost S&P 500 index fund is a good choice for an equity holding, but their are even lower-cost options available tracking the same S&P 500 index. The SPY fund/ETF has an expense ratio of .09%, while IVV is only .04% and VOO is .03%. If you're planning on buying and holding the lower ER funds will save you money over time. If however you're a frequent trader (not recommended) SPY does have higher volume more 'options' available, and is more frequently used among non-Boglehead traders.
"To achieve satisfactory investment results is easier than most people realize; to achieve superior results is harder than it looks." - Benjamin Graham

Topic Author
thelateinvestor43
Posts: 166
Joined: Fri Nov 15, 2019 2:02 am
Location: Westbrook, Maine

Re: How do I go about buying the SPY ETF at Fidelity?

Post by thelateinvestor43 » Tue Dec 03, 2019 2:43 am

JoMoney wrote:
Mon Dec 02, 2019 10:07 am
Fidelity has customer service numbers you can call for help:
https://www.fidelity.com/customer-servi ... s/overview

As well as comprehensive online tutorials and help/guides:
https://www.fidelity.com/trading/faqs-placing-orders
https://www.fidelity.com/learning-cente ... g/overview
https://www.fidelity.com/trading/faqs-about-account

I suggest you slow down and don't rush into making any purchases until you have a good understanding of what you're doing.
For what it's worth, I think a low-cost S&P 500 index fund is a good choice for an equity holding, but their are even lower-cost options available tracking the same S&P 500 index. The SPY fund/ETF has an expense ratio of .09%, while IVV is only .04% and VOO is .03%. If you're planning on buying and holding the lower ER funds will save you money over time. If however you're a frequent trader (not recommended) SPY does have higher volume more 'options' available, and is more frequently used among non-Boglehead traders.
Thanks I think for now I'll go with either FXAIX Fidelity 500 INDEX FUND or FSUVX Fidelity Low Volatility Index Fund.

Ferdinand2014
Posts: 835
Joined: Mon Dec 17, 2018 6:49 pm

Re: How do I go about buying the SPY ETF at Fidelity?

Post by Ferdinand2014 » Wed Dec 04, 2019 11:12 pm

FXAIX is a good choice. Lower Er then any ETF. Easier to trade. You can do exact dollar amounts. You can set up automatic investments. You do not need to determine best time to buy or sell. You do not need to put limits on orders. Tax difference is small and In some cases better then the iShare versions of equivalent index funds. Reduces behavioral mistakes as mutual funds can’t be bought and sold intraday and there are limits on round trip trading frequencies. Based on your previous posts, I sense mutual funds would be better for you then ETF’s for now.
“You only find out who is swimming naked when the tide goes out.“ — Warren Buffett

smectym
Posts: 610
Joined: Thu May 26, 2011 5:07 pm

Re: How do I go about buying the SPY ETF at Fidelity?

Post by smectym » Thu Dec 05, 2019 1:14 am

Wow, really you just put SPY into the stock symbol prompt on the brokerage platform and press “buy,” and if you have any problems from there automated help prompts will get you through.

More specifically:
(1) Log on to Fido website.
(2) Under “Accounts and Trade,” select “Trade”
(3) Under “Transaction Type,” select “Stocks/ETFs”
(4) For “Symbol,” type in SPY
(5) For “Action,” select “Buy.”
(6) For “Quantity,” select The number of shares you want to buy. If you have a specific dollar amount in mind rather than a particular share amount you can press the “calculate quantity” tool to the right of the quantity box to figure out how many shares of SPY a particular dollar amount will buy.
(7) For “Order Type,” up to you: I always select “Market Order”
(8) For “Time in Force,” select “Day.” Be assured that your order will be filled within seconds if not milliseconds of the order being placed if it’s during trading hours, and if you enter the trade after market hours, it will be filled within seconds once trading resumes the next morning.
(9) Then click “Preview Order,” to make sure everything is correct; if so click “Place Order.” You’re done!

Post Reply