Philadelphia Inquirer reports--Vanguard cut fees, this time on 15 S&P and Russell index-based ETFs

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MFInvestor
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Philadelphia Inquirer reports--Vanguard cut fees, this time on 15 S&P and Russell index-based ETFs

Post by MFInvestor » Thu Nov 07, 2019 8:11 am

"Vanguard cut fees, this time on 15 S&P and Russell index-based ETFs"

Philadelphia Inquirer November 7, 2019

https://www.inquirer.com/business/vangu ... 91107.html

Interesting article as it states that although these new rates are reported in the updated Annual Reports they are not yet effective.



The article link contains a table with all of the changes.
Just when you thought ETF expenses couldn’t go any lower, Malvern-based investment giant Vanguard has slashed expense ratios on 15 S&P and Russell index-based ETFs, according to its latest annual reports.

While assets in the 15 ETFs grew over the funds’ fiscal year, which ended Aug. 31, expenses fell. Some of the annual expenses dropped by hundredths of one percentage point, known as basis points.

For example, the S&P Smallcap 600 ETF’s expense ratio — the amount investors pay Vanguard annually to manage the fund — fell from 0.15% of assets to 0.10% in the latest year. Assets in the fund fell from $1.1 billion to $991 million.

“The prospectus figure is the expense ratio of record, due to the fact that they may change between the time of the annual report filing and the subsequent prospectus filing,” Vanguard’s Martino said. "The bottom line is you will see the funds listed report their expense ratios in December.”

retiringwhen
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Re: Philadelphia Inquirer reports--Vanguard cut fees, this time on 15 S&P and Russell index-based ETFs

Post by retiringwhen » Thu Nov 07, 2019 8:43 am

Nice, makes VIOV even more attractive.

snailderby
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Re: Philadelphia Inquirer reports--Vanguard cut fees, this time on 15 S&P and Russell index-based ETFs

Post by snailderby » Thu Nov 07, 2019 9:00 am

Great news. With these changes, IVOV and VIOV will now have the same 0.15% ER as MDYV and SLYV. VOOV (0.10% ER) will still be more expensive than SPYV (0.04% ER), and VIOO and IVOO (0.10% ER) will still be more expensive than IJH and IJR (0.07% ER).

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Re: Philadelphia Inquirer reports--Vanguard cut fees, this time on 15 S&P and Russell index-based ETFs

Post by abuss368 » Thu Nov 07, 2019 11:25 am

Vanguard is the only "mutual" mutual fund company.

Thank you Jack Bogle.
John C. Bogle: "Simplicity is the master key to financial success."

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Re: Philadelphia Inquirer reports--Vanguard cut fees, this time on 15 S&P and Russell index-based ETFs

Post by caklim00 » Thu Nov 07, 2019 2:55 pm

snailderby wrote:
Thu Nov 07, 2019 9:00 am
Great news. With these changes, IVOV and VIOV will now have the same 0.15% ER as MDYV and SLYV. VOOV (0.10% ER) will still be more expensive than SPYV (0.04% ER), and VIOO and IVOO (0.10% ER) will still be more expensive than IJH and IJR (0.07% ER).
Interesting. I wonder if state street will respond with their own cut. Regardless this is great news overall and makes VIOV even more compelling. You think they would drop the fees on the factor funds to try and get more assets. Its going to be harder to purchase VFMF over VIOV now.

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Re: Philadelphia Inquirer reports--Vanguard cut fees, this time on 15 S&P and Russell index-based ETFs

Post by HEDGEFUNDIE » Thu Nov 07, 2019 9:42 pm

abuss368 wrote:
Thu Nov 07, 2019 11:25 am
Vanguard is the only "mutual" mutual fund company.
And how does that help me, exactly?

As the post above yours indicates, it does not mean Vanguard has the lowest cost funds.

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Re: Philadelphia Inquirer reports--Vanguard cut fees, this time on 15 S&P and Russell index-based ETFs

Post by arcticpineapplecorp. » Thu Nov 07, 2019 10:04 pm

HEDGEFUNDIE wrote:
Thu Nov 07, 2019 9:42 pm
abuss368 wrote:
Thu Nov 07, 2019 11:25 am
Vanguard is the only "mutual" mutual fund company.
And how does that help me, exactly?

As the post above yours indicates, it does not mean Vanguard has the lowest cost funds.
it ensures the company puts your interests first because the company is owned by the funds and the investors in the funds are the owners by proxy.

Jack used to say, "The good book tells us that no man can serve to masters."

Fidelity and Schwab may offer lower fees on some funds, but they're only doing that to draw business away from Vanguard. They're not doing it because it helps their bottom line. Fidelity is privately owned and Schwab is publicly traded. Their interests are split between owners and customers, which are not one and the same.

Vanguard lowered fees because they don't have to worry about increasing profits for shareholders (public or private). That's what started the fee war.

A fee war is the only war where everyone wins.
"May you live as long as you want and never want as long as you live" -- Irish Blessing | "Invest we must" -- Jack Bogle

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Re: Philadelphia Inquirer reports--Vanguard cut fees, this time on 15 S&P and Russell index-based ETFs

Post by Cubicle » Thu Nov 07, 2019 10:13 pm

HEDGEFUNDIE wrote:
Thu Nov 07, 2019 9:42 pm
And how does that help me, exactly?

As the post above yours indicates, it does not mean Vanguard has the lowest cost funds.
I keep (the majority, ex. Fidelity HSA) of my money with Vanguard because I think they are crucial to everyone else lowering their fees. If everyone left Vanguard, then the others would absolutely raise their rates. So the higher fees are me contributing to the greater good.

I truly do not believe any other company would put your savings above their profits.

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abuss368
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Re: Philadelphia Inquirer reports--Vanguard cut fees, this time on 15 S&P and Russell index-based ETFs

Post by abuss368 » Thu Nov 07, 2019 10:23 pm

arcticpineapplecorp. wrote:
Thu Nov 07, 2019 10:04 pm
HEDGEFUNDIE wrote:
Thu Nov 07, 2019 9:42 pm
abuss368 wrote:
Thu Nov 07, 2019 11:25 am
Vanguard is the only "mutual" mutual fund company.
And how does that help me, exactly?

As the post above yours indicates, it does not mean Vanguard has the lowest cost funds.
it ensures the company puts your interests first because the company is owned by the funds and the investors in the funds are the owners by proxy.

Jack used to say, "The good book tells us that no man can serve to masters."

Fidelity and Schwab may offer lower fees on some funds, but they're only doing that to draw business away from Vanguard. They're not doing it because it helps their bottom line. Fidelity is privately owned and Schwab is publicly traded. Their interests are split between owners and customers, which are not one and the same.

Vanguard lowered fees because they don't have to worry about increasing profits for shareholders (public or private). That's what started the fee war.

A fee war is the only war where everyone wins.
I could not have said it better myself. Thanks!
John C. Bogle: "Simplicity is the master key to financial success."

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Phineas J. Whoopee
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Re: Philadelphia Inquirer reports--Vanguard cut fees, this time on 15 S&P and Russell index-based ETFs

Post by Phineas J. Whoopee » Fri Nov 08, 2019 6:45 pm

With due respect to the Philadelphia Inquirer, which seems to conflate expense ratios with commissions, Vanguard does not cut ERs. It reports after the fact the ratio of what it spent to how much it managed. All they did was become more efficient at minimizing cost per dollar amount of fund.

Sometimes they have reported higher ERs for some funds, although they didn't raise them.

Please keep in mind the R in ER stands for ratio, a comparison between two numbers. If either changes the ratio changes too.

PJW

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Re: Philadelphia Inquirer reports--Vanguard cut fees, this time on 15 S&P and Russell index-based ETFs

Post by MotoTrojan » Fri Nov 08, 2019 6:47 pm

caklim00 wrote:
Thu Nov 07, 2019 2:55 pm
snailderby wrote:
Thu Nov 07, 2019 9:00 am
Great news. With these changes, IVOV and VIOV will now have the same 0.15% ER as MDYV and SLYV. VOOV (0.10% ER) will still be more expensive than SPYV (0.04% ER), and VIOO and IVOO (0.10% ER) will still be more expensive than IJH and IJR (0.07% ER).
Interesting. I wonder if state street will respond with their own cut. Regardless this is great news overall and makes VIOV even more compelling. You think they would drop the fees on the factor funds to try and get more assets. Its going to be harder to purchase VFMF over VIOV now.
I had always held VIOV but was out of it fully when I recently started a position in SLYV... what to do now :).


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Re: Philadelphia Inquirer reports--Vanguard cut fees, this time on 15 S&P and Russell index-based ETFs

Post by snailderby » Fri Nov 08, 2019 6:51 pm

I vaguely remember some discussion about SLYV being structured differently compared to competing ETFs? Something about it being a trust or something, if I recall correctly? Practically speaking, is that something that I need to consider or worry about?

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Re: Philadelphia Inquirer reports--Vanguard cut fees, this time on 15 S&P and Russell index-based ETFs

Post by oldzey » Sat Nov 09, 2019 2:38 pm

Great news!

Thanks for the information, MFInvestor!

I tax-loss harvested U.S. equity ETFs multiple times last December, and VONE is what I was holding when U.S. equities went back up.

I'll gladly take the 4 bps. Thank you, Vanguard! :beer

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