VTSAX vs VOO

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Topic Author
jacobacro
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Location: Springfield, Oregon, USA

VTSAX vs VOO

Post by jacobacro » Mon Mar 23, 2020 8:51 pm

What is the difference between VTSAX and VOO? I have read that ETFs are an improvement over mutual funds because ETFs have lower expense ratios, but VTSAX is a mutual and it has almost the same expense ratio as VOO. What is the difference?


VTSAX Stock - Large-Cap Blend 0.04% $54.49

VOO Stock - Large-Cap Blend 0.03% $204.53

DSInvestor
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Re: VTSAX vs VOO

Post by DSInvestor » Mon Mar 23, 2020 8:53 pm

Total Stock Market Index VTSAX Admiral has an ETF share class VTI. Two share classes of the same fund.

500 Index VFIAX has an ETF share class VOO which mirrors just the S&P 500 index.

Total Stock Market and 500 Index are highly correlated and are often used as Tax Loss Harvest replacement holdings for each other.

Either fund would be appropriate for your core US stock allocation.
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carmonkie
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Re: VTSAX vs VOO

Post by carmonkie » Mon Mar 23, 2020 8:56 pm

VOO tracks the S&P 500 index while VTSAX is the Total US Stock, which includes Mid-Cap and Sm-Cap something VOO does not include.
VOO has about 80% of the stocks in VTSAX.

Xrayman69
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Re: VTSAX vs VOO

Post by Xrayman69 » Mon Mar 23, 2020 9:35 pm

The ETF trades like a stock, can buy and sell in “real time” where as the mutual fund transaction occur upon close of trading day.

Mutual funds can be bought and sold with partial shares on a dollar amount, I think the ETFs are bought and sold in whole shares.

redfan11
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Re: VTSAX vs VOO

Post by redfan11 » Mon Mar 23, 2020 9:56 pm

Xrayman69 wrote:
Mon Mar 23, 2020 9:35 pm
The ETF trades like a stock, can buy and sell in “real time” where as the mutual fund transaction occur upon close of trading day.

Mutual funds can be bought and sold with partial shares on a dollar amount, I think the ETFs are bought and sold in whole shares.
Its the other way around. Mutual funds can only be bought as a whole shaare. An ETF allows fractional purchases.

dardeninvestor
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Re: VTSAX vs VOO

Post by dardeninvestor » Mon Mar 23, 2020 10:04 pm

Would also add that in most cases an ETF is better in taxable brokerage. With Vanguard, doesn’t matter. If you can meet the Vanguard Mutual fund’s minimum investment and plan to contribute regularly go with the mutual fund version.

Whether to pick S&P500 vs total stock market is still a matter of debate, mostly academic. Used to be slightly more expensive to track total stock market since more moving parts but not the case anymore.

You will be well diversified with a cheap expense ratio tracking the S&P500 and I personally would not overthink it more than that.

Alex GR
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Re: VTSAX vs VOO

Post by Alex GR » Tue Mar 24, 2020 1:23 am

So if I have VOO, VOE and VBR separately, without VTI, there's no overlap?
Or there is overlap between VOO and VOE?

Sabre1
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Re: VTSAX vs VOO

Post by Sabre1 » Tue Mar 24, 2020 1:56 am

It’s my understanding that Voo has a slightly higher qualified dividend. I believe today the dividend yield of voo is almost a half percent higher than vti. But Ove always heard the difference is relatively minor.

22twain
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Re: VTSAX vs VOO

Post by 22twain » Tue Mar 24, 2020 4:31 am

redfan11 wrote:
Mon Mar 23, 2020 9:56 pm
Xrayman69 wrote:
Mon Mar 23, 2020 9:35 pm
Mutual funds can be bought and sold with partial shares on a dollar amount, I think the ETFs are bought and sold in whole shares.
Its the other way around. Mutual funds can only be bought as a whole shaare. An ETF allows fractional purchases.
No, Xrayman69 got it mostly right.

Mutual funds can be bought/sold at arbitrary dollar amounts, e.g. exactly $10,000.00, with a corresponding non-integer number of shares.

ETFs must usually be bought/sold as whole shares, except for automatically reinvesting dividends and capital-gain distributions, for which most brokerages will in effect generate fractional shares, via an accounting "trick". A recent development is that some brokerages (e.g. Fidelity, IIRC) now perform this trick also with customer purchases and sales.
My investing princiPLEs do not include absolutely preserving princiPAL.

redfan11
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Re: VTSAX vs VOO

Post by redfan11 » Tue Mar 24, 2020 11:59 am

22twain wrote:
Tue Mar 24, 2020 4:31 am
redfan11 wrote:
Mon Mar 23, 2020 9:56 pm
Xrayman69 wrote:
Mon Mar 23, 2020 9:35 pm
Mutual funds can be bought and sold with partial shares on a dollar amount, I think the ETFs are bought and sold in whole shares.
Its the other way around. Mutual funds can only be bought as a whole shaare. An ETF allows fractional purchases.
No, Xrayman69 got it mostly right.

Mutual funds can be bought/sold at arbitrary dollar amounts, e.g. exactly $10,000.00, with a corresponding non-integer number of shares.

ETFs must usually be bought/sold as whole shares, except for automatically reinvesting dividends and capital-gain distributions, for which most brokerages will in effect generate fractional shares, via an accounting "trick". A recent development is that some brokerages (e.g. Fidelity, IIRC) now perform this trick also with customer purchases and sales.

Thanks for correcting me! You are right.

Topic Author
jacobacro
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Location: Springfield, Oregon, USA

Re: VTSAX vs VOO

Post by jacobacro » Tue Mar 24, 2020 1:23 pm

The minimum for VTSAX on Vanguard is $3000. After I buy the minimum could I then add ten dollars to it?

lakpr
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Re: VTSAX vs VOO

Post by lakpr » Tue Mar 24, 2020 1:46 pm

jacobacro wrote:
Tue Mar 24, 2020 1:23 pm
The minimum for VTSAX on Vanguard is $3000. After I buy the minimum could I then add ten dollars to it?
I think the prospectus (don't have it in front of me) says subsequent minimum purchases have to be at least $250.

If you want to have last-dollar purchases, I think Fidelity and its funds are better bet for you. Fidelity has a lot of funds with $0 minimum and a few more with $1 minimum, and all subsequent purchases also $1 minimum

DSInvestor
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Re: VTSAX vs VOO

Post by DSInvestor » Tue Mar 24, 2020 1:50 pm

jacobacro wrote:
Tue Mar 24, 2020 1:23 pm
The minimum for VTSAX on Vanguard is $3000. After I buy the minimum could I then add ten dollars to it?
Once the minimum initial investment has been met, additional investments can be as small as $1.
https://investor.vanguard.com/mutual-fu ... fees/vtsax
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annu
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Re: VTSAX vs VOO

Post by annu » Tue Mar 24, 2020 1:53 pm

You can always use fidelity, https://fundresearch.fidelity.com/mutua ... /315911693 (Total stock market), similar to VTSAX, FSKAX, has no minimums and bit cheaper. You do have to hold it at Fidelity though.

dardeninvestor
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Re: VTSAX vs VOO

Post by dardeninvestor » Tue Mar 24, 2020 9:40 pm

I use SWPPX in tax advantaged thru Schwab, no minimums. I got tired of those sorts of bookkeeping rules with Vanguard.

Alex GR
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Re: VTSAX vs VOO

Post by Alex GR » Wed Mar 25, 2020 2:54 am

Ok, so the ETF and mutual fund is identical (I mean VTSAX vs. VTI, not VOO as incorrectly indicated in the subject, 'cause VOO is identical to VFIAX). But is there a psychological aspect to it?
Whenever I need to add VTI I find myself attempting to time it, i.e. set the limit price at lowest for the day (or the past few days) since it's not an urgent purchase but rather done as part of rebalancing.
With mutual funds it's a fixed amount so that kind of analysis paralysis does not take place. Is a mutual fund better from that perspective?

Topic Author
jacobacro
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Location: Springfield, Oregon, USA

Re: VTSAX vs VOO

Post by jacobacro » Wed Mar 25, 2020 1:19 pm

dardeninvestor wrote:
Tue Mar 24, 2020 9:40 pm
I use SWPPX in tax advantaged thru Schwab, no minimums. I got tired of those sorts of bookkeeping rules with Vanguard.
I have been disappointed at how much work I have to do to buy an ETF at Vanguard. I can set the site to automatically pull money from my checking into my vanguard money market fund, but then I have to go in and manually buy an etf.

At Schwab can you set the website to automatically buy a certain etf or mutual fund each month?

apneely
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Re: VTSAX vs VOO

Post by apneely » Thu Mar 26, 2020 8:43 am

Once you hit the $3000 mark in VTSAX you can opt for automatic investments. I just did this with my wife's account. We were in VTI until we reached the $3000 mark, sold it, and bought VTSAX. I had the same frustration you did until I called them and asked.

dardeninvestor
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Re: VTSAX vs VOO

Post by dardeninvestor » Thu Mar 26, 2020 11:32 am

jacobacro wrote:
Wed Mar 25, 2020 1:19 pm
dardeninvestor wrote:
Tue Mar 24, 2020 9:40 pm
I use SWPPX in tax advantaged thru Schwab, no minimums. I got tired of those sorts of bookkeeping rules with Vanguard.
I have been disappointed at how much work I have to do to buy an ETF at Vanguard. I can set the site to automatically pull money from my checking into my vanguard money market fund, but then I have to go in and manually buy an etf.

At Schwab can you set the website to automatically buy a certain etf or mutual fund each month?
Yes you can at Schwab. So long as you have $100 in SWPPX, you can start automatic investments. Not sure about ETFs, but for sure with their mutual funds.

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