Fidelity Brokerage - Fund purchase from linked account?

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Topic Author
evancox10
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Fidelity Brokerage - Fund purchase from linked account?

Post by evancox10 »

I recently opened up a Fidelity brokerage, I was wondering if I’m able to purchase a fund / stock / ETF and to use a linked checking account as the source of the funds in a single step. Or do I have to do two steps, first transfer the money, then do a trade? What guarantee if any is made in the availability of the transferred funds? Funding a purchase from my checking account is simple to do with Vanguard, I’m not sure if I’m missing something.
MrJedi
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Re: Fidelity Brokerage - Fund purchase from linked account?

Post by MrJedi »

I don't think the single step automatic transfer is possible.

You do immediately get cash available to trade by initiating a transfer first though. You don't have to wait for the cash transfer to settle.
terran
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Re: Fidelity Brokerage - Fund purchase from linked account?

Post by terran »

MrJedi wrote: Fri Sep 18, 2020 9:58 am I don't think the single step automatic transfer is possible.

You do immediately get cash available to trade by initiating a transfer first though. You don't have to wait for the cash transfer to settle.
+1. This matches my experience.
Ferdinand2014
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Re: Fidelity Brokerage - Fund purchase from linked account?

Post by Ferdinand2014 »

evancox10 wrote: Fri Sep 18, 2020 9:25 am I recently opened up a Fidelity brokerage, I was wondering if I’m able to purchase a fund / stock / ETF and to use a linked checking account as the source of the funds in a single step. Or do I have to do two steps, first transfer the money, then do a trade? What guarantee if any is made in the availability of the transferred funds? Funding a purchase from my checking account is simple to do with Vanguard, I’m not sure if I’m missing something.
Absolutely 1 step. Once set up actually no steps. I do it every week. Mutual fund only. Not stock or ETF. First you must have set up bank to link with. Then make a first purchase of the mutual fund you wish to set up automatic purchases with the brokerage account. $1 will do. Then go to accounts and trade>account features>payments and transfers>automatic transfers and investments. I buy FXAIX every week from my checking account to Fidelity brokerage account. Requires no intervention on my part. The above posts are incorrect.
Last edited by Ferdinand2014 on Fri Sep 18, 2020 10:20 am, edited 1 time in total.
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Faith20879
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Re: Fidelity Brokerage - Fund purchase from linked account?

Post by Faith20879 »

evancox10 wrote: Fri Sep 18, 2020 9:25 am Funding a purchase from my checking account is simple to do with Vanguard, I’m not sure if I’m missing something.
I have done the same kind of automatic investing at Fidelity for 20 years. Linked up the bank account and set up an automatic purchase at a frequency that suited me. It never failed. I am surprised that you are having trouble.

I've only dealt with MF and have stopped all automatic purchases a couple years ago since I am now in decumulation phase. Don't think Fidelity would have changed this feature.
MrJedi
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Re: Fidelity Brokerage - Fund purchase from linked account?

Post by MrJedi »

Automatic MF purchases are possible, but not for ETFs from my experience.
MrJedi
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Re: Fidelity Brokerage - Fund purchase from linked account?

Post by MrJedi »

Ferdinand2014 wrote: Fri Sep 18, 2020 10:15 am
evancox10 wrote: Fri Sep 18, 2020 9:25 am I recently opened up a Fidelity brokerage, I was wondering if I’m able to purchase a fund / stock / ETF and to use a linked checking account as the source of the funds in a single step. Or do I have to do two steps, first transfer the money, then do a trade? What guarantee if any is made in the availability of the transferred funds? Funding a purchase from my checking account is simple to do with Vanguard, I’m not sure if I’m missing something.
Absolutely 1 step. Once set up actually no steps. I do it every week. Mutual fund only. Not stock or ETF. First you must have set up bank to link with. Then make a first purchase of the mutual fund you wish to set up automatic purchases with the brokerage account. $1 will do. Then go to accounts and trade>account features>payments and transfers>automatic transfers and investments. I buy FXAIX every week from my checking account to Fidelity brokerage account. Requires no intervention on my part. The above posts are incorrect.
The post mentions nothing about automatic purchases (0 steps) but rather 1 step transfer and trade.

Also asked about stock and ETF explicitly.
arf30
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Re: Fidelity Brokerage - Fund purchase from linked account?

Post by arf30 »

You can only fund purchases directly from checking accounts with mutual funds, stocks/ETFs have to transfer in as cash and then can be traded once settled. If you have margin enabled it might be possible to trade immediately with a margin loan before the bank transfer completes, but I've never tried it.
MrJedi
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Re: Fidelity Brokerage - Fund purchase from linked account?

Post by MrJedi »

arf30 wrote: Fri Sep 18, 2020 10:51 am You can only fund purchases directly from checking accounts with mutual funds, stocks/ETFs have to transfer in as cash and then can be traded once settled. If you have margin enabled it might be possible to trade immediately with a margin loan before the bank transfer completes, but I've never tried it.
Cash doesn't need to settle before trade. I do it all the time (cash account). Initiate transfer and then cash available to trade updates immediately, can buy ETF immediately.
Topic Author
evancox10
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Re: Fidelity Brokerage - Fund purchase from linked account?

Post by evancox10 »

Thanks everyone for the answers. This confirms what I'm seeing. I was specifically trying to do a manual purchase into an ETF, not a recurring/automatic purchase, but it's good to know that automatic MF purchases are possible. Also good to know that the money will be available immediately after I do the linked account transfer. Again, thank you everyone!

Edit:
One more question: is the cash available to trade even if I initiate the transfer on, say, a weekend? Sometimes I am doing these things on the weekend, and I would like to "fire and forget" a purchase, knowing it will happen on the next business day. I will probably go experiment with this anyways, but thought I'd ask too.
Topic Author
evancox10
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Re: Fidelity Brokerage - Fund purchase from linked account?

Post by evancox10 »

Update: looks like the transferred money is still available on the weekend, but can only be used to setup a mutual fund buy. Can't do a market order ETF buy on the weekend.
sgm7091
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Re: Fidelity Brokerage - Fund purchase from linked account?

Post by sgm7091 »

From my experience, with Fidelity, you can:
- Transfer money from external accounts recurring set and forget
- Have transferred money (when confirmed) recurring set to buy MFs set and forget (MFs use end of day NAV)
- You cannot (yet) have recurring set and forget - buy or sell ETF/Stocks
inverter
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Re: Fidelity Brokerage - Fund purchase from linked account?

Post by inverter »

Another reason why Vanguard is superior, on top of their customer service! :P
sgm7091
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Re: Fidelity Brokerage - Fund purchase from linked account?

Post by sgm7091 »

Does vanguard allow recurring purchase of ETFs? I did not think anyone did that except some fixed $$ Monthly to buy Selected fractional stocks by Schwab etc.
terran
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Re: Fidelity Brokerage - Fund purchase from linked account?

Post by terran »

evancox10 wrote: Sat Sep 19, 2020 7:50 am Update: looks like the transferred money is still available on the weekend, but can only be used to setup a mutual fund buy. Can't do a market order ETF buy on the weekend.
That's probably a good thing. ETFs seem to do funny/spiky things (in both directions) first thing in the morning from what I've seen.
MrJedi
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Re: Fidelity Brokerage - Fund purchase from linked account?

Post by MrJedi »

evancox10 wrote: Sat Sep 19, 2020 7:50 am Update: looks like the transferred money is still available on the weekend, but can only be used to setup a mutual fund buy. Can't do a market order ETF buy on the weekend.
You can do an "On the Open" order in Fidelity if you want to get your order in at the next opening price.
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BroIceCream
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Re: Fidelity Brokerage - Fund purchase from linked account?

Post by BroIceCream »

terran wrote: Fri Sep 18, 2020 10:08 am
MrJedi wrote: Fri Sep 18, 2020 9:58 am I don't think the single step automatic transfer is possible.

You do immediately get cash available to trade by initiating a transfer first though. You don't have to wait for the cash transfer to settle.
+1. This matches my experience.
+1 My experience too. If initiated from Fidelity, it just needs to show as pending. I've also initiated transfer from Etrade to Fidelity, and as soon as the Fidelity side showed "pending", I was able to invest the money in mutual funds, before it had completed the transfer.
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