How do in-kind transfers work?

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Aguilar
Posts: 6
Joined: Fri Jan 24, 2020 11:01 pm

How do in-kind transfers work?

Post by Aguilar » Fri Feb 14, 2020 8:32 am

I'm executing an in-kind transfer from Vanguard to eTrade.

My understanding is that my mutual fund assets remain in market the entire time. Is there someone who can explain how the institutions actually pull this off? I'm just curious. Once the money leaves one institution, how does the money remain in market?

And is there any way to do a sanity check after the transfer is completed to ensure it worked properly?

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JoMoney
Posts: 8369
Joined: Tue Jul 23, 2013 5:31 am

Re: How do in-kind transfers work?

Post by JoMoney » Fri Feb 14, 2020 8:38 am

Your shares are never sold, unless you have a cash balance there is no "money" moving, the shares being held at one broker are just moved to another.
Look at the number of shares before and after the move.
"To achieve satisfactory investment results is easier than most people realize; to achieve superior results is harder than it looks." - Benjamin Graham

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alpenglow
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Joined: Tue May 31, 2011 12:02 pm

Re: How do in-kind transfers work?

Post by alpenglow » Fri Feb 14, 2020 8:42 am

They use a system called ACATS. Here is some info.

https://www.investopedia.com/terms/a/acat.asp

I'd print a copy of your account holdings before the move, though I've never had a problem with it.

student
Posts: 4498
Joined: Fri Apr 03, 2015 6:58 am

Re: How do in-kind transfers work?

Post by student » Fri Feb 14, 2020 8:45 am

alpenglow wrote:
Fri Feb 14, 2020 8:42 am
They use a system called ACATS. Here is some info.

https://www.investopedia.com/terms/a/acat.asp

I'd print a copy of your account holdings before the move, though I've never had a problem with it.
+1. It is pretty seamless. Note that the cost basis may take a week more to transfer over. In any case, print a copy before the transfer...

Caduceus
Posts: 2277
Joined: Mon Sep 17, 2012 1:47 am

Re: How do in-kind transfers work?

Post by Caduceus » Fri Feb 14, 2020 10:28 am

Save the statements and a screenshot of your portfolio summary, taking note especially of the total number of shares held in each position. Sometimes people get confused with in-kind transfers if they're looking at a dollar value because the share prices have fluctuated in the meantime. As long as you get the same number of shares at your destination account, you're good to go.

It's quite simple.

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