Sell/Buy Timing Question

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Topic Author
TallBoy29er
Posts: 1208
Joined: Thu Jul 18, 2013 9:06 pm

Sell/Buy Timing Question

Post by TallBoy29er »

So got my relative to move from Morgan Stanley (1.15% AUM fee) to Schwab. This is an IRA, with a ton of individual stocks and overlapping mutual funds. I'm going to liquidate the entire portfolio, and move to our agreed upon 50/50 asset allocation.

My question is, on a certain day I am going to put sell orders in for every holding. How long do I then have to wait to buy the two funds I want (an S&P 500 and Total Bond)? Can I do this immediately, or do I have to wait for a settlement period?

I figured I can experiment and figure this out, but was hoping to learn from others.

Cheers!
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Wiggums
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Joined: Thu Jan 31, 2019 8:02 am

Re: Sell/Buy Timing Question

Post by Wiggums »

It depends on several factors. In an IRA, #1 applies

1) If it’s a cash account and you don’t have other funds, you must wait until settlement.

2) If you’re trying to avoid a wash sale violation then it’s 60 days, 30 days before and 30 days after.

3) If you have the funds available (cash account) or it’s a margin account then you can buy the shares back in milliseconds.
Investors need to be better informed about the costs they pay. “High fund fees can be hazardous to your wealth in the same way that high calories can be hazardous for your health.”
exodusNH
Posts: 1992
Joined: Wed Jan 06, 2021 8:21 pm

Re: Sell/Buy Timing Question

Post by exodusNH »

Wiggums wrote: Thu Jan 13, 2022 10:46 pm It depends on several factors. In an IRA, #1 applies

1) If it’s a cash account and you don’t have other funds, you must wait until settlement.

2) If you’re trying to avoid a wash sale violation then it’s 60 days, 30 days before and 30 days after.

3) If you have the funds available (cash account) or it’s a margin account then you can buy the shares back in milliseconds.
I don't know about Schwab, but at Vanguard you can buy with the unsettled funds. You get a warning when you buy that you can't sell them until after the settlement period to prevent trading violations unless you move new cash in to cover the original sale.
000
Posts: 6542
Joined: Thu Jul 23, 2020 12:04 am

Re: Sell/Buy Timing Question

Post by 000 »

I have bought with unsettled funds in a Vanguard IRA and taxable cash accounts at Vanguard and Fidelity before, when selling stocks/ETFs to buy something else.

Plain old mutual funds might require waiting for settlement, which should be T+1.
What goes up must come down 😎
Topic Author
TallBoy29er
Posts: 1208
Joined: Thu Jul 18, 2013 9:06 pm

Re: Sell/Buy Timing Question

Post by TallBoy29er »

Thank you all!
dbr
Posts: 39000
Joined: Sun Mar 04, 2007 9:50 am

Re: Sell/Buy Timing Question

Post by dbr »

You might check on selling and buying commissions at the two brokers. Also moving the assets in cash and buying at Schwab is an option. Don't get freaked out if some time is needed to settle different things. It won't matter in the long run. Sometimes there are also dribbles if a dividend posts during the process.
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