Vanguard Equivalents in new TDA commission free list

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B4Xt3r
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Vanguard Equivalents in new TDA commission free list

Post by B4Xt3r »

Hi All,

I posted this in the large thread but I fear that thread is too noisy a discussion. I am wondering what is the best equivalent of BSV, VSS, and BNDX.

For BSV, is it some combination of SPSB/SPTS?
For VSS, is it some combination of GWX/EWX?
For BNDX, is it IAGG?

Thanks!

-kehyler

Commission free list: https://www.tdameritrade.com/retail-en_ ... 000835.pdf

BSV info: http://www.etf.com/BSV
SPSB info: http://www.etf.com/SPSB
SPTS info: http://www.etf.com/SPTS

VSS info: http://www.etf.com/VSS
GWX info: http://www.etf.com/GWX
EWX info: http://www.etf.com/EWX

BNDX info: http://www.etf.com/BNDX
IAGG info: http://www.etf.com/IAGG
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jhfenton
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Re: Vanguard Equivalents in new TDA commission free list

Post by jhfenton »

kehyler wrote: Mon Nov 20, 2017 7:33 am For BSV, is it some combination of SPSB/SPTS?
Yes. I'd be tempted, though to just pick one for simplicity. They are both reasonable choices.
kehyler wrote: Mon Nov 20, 2017 7:33 am For VSS, is it some combination of GWX/EWX?
Yes. But neither choice is compelling. (There is no perfectly equivalent fund to VSS in existence.) I'd probably pay a commission to use VSS. If making periodic contributions, I'd accumulate in one of the other funds and then do a lump sum swap once a year (or however often seems reasonable).
kehyler wrote: Mon Nov 20, 2017 7:33 am For BNDX, is it IAGG?
Yes. Unlike the others you asked about, it is virtually a perfect replacement.
Topic Author
B4Xt3r
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Re: Vanguard Equivalents in new TDA commission free list

Post by B4Xt3r »

Thanks!
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B4Xt3r
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Re: Vanguard Equivalents in new TDA commission free list

Post by B4Xt3r »

Ok, I think that I have an idea of some specifics.

For BSV, online from vanguard it says that it is 64.1% treasury, so then BSV could perhaps be approximated by 0.641*SPTS + 0.359*SPSB?

I will probably just forgo the VSS replacements because of their expense ratios. For completeness sake though. VSS, would it be ok to approximate BSV by 0.80*GWX + 0.20*EWX? The 0.2 comes from vanguard's VSS page being 20% emerging markets.
Theoretical
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Re: Vanguard Equivalents in new TDA commission free list

Post by Theoretical »

For replacing VSS, that would be correct, though you shouldn't hold either in taxable due to capital gains distributions. On the other hand, you shouldn't worry about the expense ratio directly, as both funds have such extensive securities lending revenues that they routinely run negative expense ratios.
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B4Xt3r
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Re: Vanguard Equivalents in new TDA commission free list

Post by B4Xt3r »

Theoretical wrote: Wed Nov 22, 2017 11:16 am For replacing VSS, that would be correct, though you shouldn't hold either in taxable due to capital gains distributions. On the other hand, you shouldn't worry about the expense ratio directly, as both funds have such extensive securities lending revenues that they routinely run negative expense ratios.
Ok, thanks. Is my understanding for BSV also ok?
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B4Xt3r
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Re: Vanguard Equivalents in new TDA commission free list

Post by B4Xt3r »

Also, just for completeness I realized that there is also a decent way to replicate VXUS, namely 0.8*SPDW +0.2*SPEM. Of course, if anyone has any advice, I'll have open ears. :sharebeer
livesoft
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Re: Vanguard Equivalents in new TDA commission free list

Post by livesoft »

SPDW + SPEM seems OK, but the average market cap is higher than with VXUS. This can be addressed by adding in some DGS, too. For instance, 80% SPDW, 15% SPEM, and 5% DGS looks more similar to 100% VXUS when using morningstar.com's instant X-ray tool.
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B4Xt3r
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Re: Vanguard Equivalents in new TDA commission free list

Post by B4Xt3r »

livesoft wrote: Thu Nov 23, 2017 7:54 am SPDW + SPEM seems OK, but the average market cap is higher than with VXUS. This can be addressed by adding in some DGS, too. For instance, 80% SPDW, 15% SPEM, and 5% DGS looks more similar to 100% VXUS when using morningstar.com's instant X-ray tool.
This is true, I hadn't run my thoughts through x-ray tool yet - good catch. I should have done that already.

Given DGS's expense ratio though (0.6ish), a 5% portion of portfolio seems somewhat uncompelling personally. Interesting quandary though for a boglehead, which axiom is more important when we can't have them all: low cost, diversification, or the market weight?
livesoft
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Re: Vanguard Equivalents in new TDA commission free list

Post by livesoft »

I like to tilt to small-cap value, so about 10% of my international is in DGS. I find it compelling when it goes up. Not so compelling when it goes down.
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Matt Y.
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Re: Vanguard Equivalents in new TDA commission free list

Post by Matt Y. »

DLS is an option I use for international small cap. The ER not great, but since purchasing shortly after issuance, I have been satisfied with overall.
Theoretical
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Re: Vanguard Equivalents in new TDA commission free list

Post by Theoretical »

Indeed, DLS is a pretty reliable fund, and it's basically tracked DFA's International Small Value fund from the former's inception.
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