VTI vs VTSAX

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bugaloo
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VTI vs VTSAX

Post by bugaloo » Fri Jul 05, 2019 1:31 pm

VTI vs VTSAX

I am starting to do monthly purchase of VTI or VTSAX on top of my usual retirement accounts, etc. I tried to do it on my TDAmeritrade account, but I am confused.

VTI - it lets me buy like I am buying shares. I can dictate how many shares I want and it is trading at ~$152/share. I know this is because it is an etf that functions like a security or stock.

VTSAX - It just says minimum amount I can invest is $3000 but it doesn't tell me what it's value per share is. When I google, it says ~$74/share. So how do I know 'how much' I am buying? Or is this the wrong way of thinking when it comes to buying mutual funds?

I think there are added fees if I buy VTSAX thru TD Ameritrade and it is better to buy directly thru Vanguard, but that means I have to open yet another account on top of my TD Ameritrade. Is there a huge advantage/disadvantage of doing VTI vs VTSAX?

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Re: VTI vs VTSAX

Post by donaldfair71 » Fri Jul 05, 2019 1:41 pm

bugaloo wrote:
Fri Jul 05, 2019 1:31 pm
Or is this the wrong way of thinking
Re: mutual funds, you usually think of it as X amount of money. With ETFs, you think of it as X amount of shares.

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Re: VTI vs VTSAX

Post by livesoft » Fri Jul 05, 2019 1:52 pm

There are fees to buy VTI at TDAmeritrade.
There are even higher fees to buy VTSAX at TDAmeritrade.

I would not buy VTI nor VTSAX at TDAmeritrade because of the high fees.

Instead I would buy SPTM at TDAmertrade because there are no fees to do so. Full disclosure: I own VTI and SPTM, but not VTSAX.

One should learn which Total Market Index fund or ETF is available for no commission at their brokerage and use that instead of VTI or VTSAX.
Last edited by livesoft on Fri Jul 05, 2019 1:53 pm, edited 1 time in total.
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jaxinvestor
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Re: VTI vs VTSAX

Post by jaxinvestor » Fri Jul 05, 2019 1:52 pm

On Fidelity, there is a pretty big charge to buy a Vanguard mutual fund while the ETF costs 4.95 to purchase. If you choose to not open a Vanguard account, the VTI is likely the better choice to avoid the larger commission charge.

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Re: VTI vs VTSAX

Post by arcticpineapplecorp. » Fri Jul 05, 2019 1:59 pm

you can read some of the differences here:
https://www.bogleheads.org/wiki/ETFs_vs_mutual_funds
https://www.bogleheads.org/wiki/Outline ... tual_funds

with ETFs you can buy intra day, meaning the price at a particular time in the day.

with mutual funds provided you purchase before 4 p.m. you will get whatever the price (N.A.V.) will be as of the close of that trading day. You won't necessarily know the exact price when you buy but generally the price will follow the increase or decrease in price from the day before based on the percentage change in the market (in your example, a total market fund). For instance, say you want to buy a total market index fund and you can see around 3:45 the market appears to be down 1% for the day (relative to where the market opened this day and/or closed the previous day). It's safe to assume if you buy your shares before 4 that you would be buying shares 1% cheaper than they were the day before (and/or at the open for that day).

With ETFs you also don't know the exact price your going to execute your trade unless you put a certain limit order to not buy/sell above or below a certain price. But a widely held ETF like a total market one should get you close enough to the price you think you're going to get. But even then you might not know exactly what price you're buying until it executes.

ETFs dropped massively during the flash crash of 2010. This did not happen to mutual funds because the price (N.A.V.) was the same all day and didn't change until the market closed at 4 p.m and the new price of the market was determined. source: https://en.wikipedia.org/wiki/2010_Flash_Crash

Does that help?
Last edited by arcticpineapplecorp. on Fri Jul 05, 2019 2:01 pm, edited 2 times in total.
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02nz
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Re: VTI vs VTSAX

Post by 02nz » Fri Jul 05, 2019 1:59 pm

The main advantage of VTSAX in this case would be the ability to set up an automatic investment plan for a set amount every month or whatever schedule you choose. This is possible because with the traditional mutual fund you can buy fractional shares. With VTI you can't do that, so you have to place the order manually (or at least I'm not aware of an ability to do an automatic investment plan with ETFs).

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bugaloo
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Re: VTI vs VTSAX

Post by bugaloo » Sat Jul 06, 2019 10:54 pm

But doesn't that mean that eventually at market close, the VTSAX mutual fund would still reflect the changes of the day during the 2010 flash crash?

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Re: VTI vs VTSAX

Post by bugaloo » Sat Jul 06, 2019 10:55 pm

arcticpineapplecorp. wrote:
Fri Jul 05, 2019 1:59 pm
you can read some of the differences here:
https://www.bogleheads.org/wiki/ETFs_vs_mutual_funds
https://www.bogleheads.org/wiki/Outline ... tual_funds

with ETFs you can buy intra day, meaning the price at a particular time in the day.

with mutual funds provided you purchase before 4 p.m. you will get whatever the price (N.A.V.) will be as of the close of that trading day. You won't necessarily know the exact price when you buy but generally the price will follow the increase or decrease in price from the day before based on the percentage change in the market (in your example, a total market fund). For instance, say you want to buy a total market index fund and you can see around 3:45 the market appears to be down 1% for the day (relative to where the market opened this day and/or closed the previous day). It's safe to assume if you buy your shares before 4 that you would be buying shares 1% cheaper than they were the day before (and/or at the open for that day).

With ETFs you also don't know the exact price your going to execute your trade unless you put a certain limit order to not buy/sell above or below a certain price. But a widely held ETF like a total market one should get you close enough to the price you think you're going to get. But even then you might not know exactly what price you're buying until it executes.

ETFs dropped massively during the flash crash of 2010. This did not happen to mutual funds because the price (N.A.V.) was the same all day and didn't change until the market closed at 4 p.m and the new price of the market was determined. source: https://en.wikipedia.org/wiki/2010_Flash_Crash

Does that help?
Thank you for that explanation. But doesn't that just mean that the VTSAX mutual fund would reflect the day's changes of the market at the end of the day during that flash crash?

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Re: VTI vs VTSAX

Post by mcraepat9 » Sat Jul 06, 2019 11:04 pm

bugaloo wrote:
Sat Jul 06, 2019 10:55 pm
arcticpineapplecorp. wrote:
Fri Jul 05, 2019 1:59 pm
you can read some of the differences here:
https://www.bogleheads.org/wiki/ETFs_vs_mutual_funds
https://www.bogleheads.org/wiki/Outline ... tual_funds

with ETFs you can buy intra day, meaning the price at a particular time in the day.

with mutual funds provided you purchase before 4 p.m. you will get whatever the price (N.A.V.) will be as of the close of that trading day. You won't necessarily know the exact price when you buy but generally the price will follow the increase or decrease in price from the day before based on the percentage change in the market (in your example, a total market fund). For instance, say you want to buy a total market index fund and you can see around 3:45 the market appears to be down 1% for the day (relative to where the market opened this day and/or closed the previous day). It's safe to assume if you buy your shares before 4 that you would be buying shares 1% cheaper than they were the day before (and/or at the open for that day).

With ETFs you also don't know the exact price your going to execute your trade unless you put a certain limit order to not buy/sell above or below a certain price. But a widely held ETF like a total market one should get you close enough to the price you think you're going to get. But even then you might not know exactly what price you're buying until it executes.

ETFs dropped massively during the flash crash of 2010. This did not happen to mutual funds because the price (N.A.V.) was the same all day and didn't change until the market closed at 4 p.m and the new price of the market was determined. source: https://en.wikipedia.org/wiki/2010_Flash_Crash

Does that help?
Thank you for that explanation. But doesn't that just mean that the VTSAX mutual fund would reflect the day's changes of the market at the end of the day during that flash crash?
Yes but if I recall correctly the flash crash corrected itself by market close.
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Re: VTI vs VTSAX

Post by Thesaints » Sat Jul 06, 2019 11:08 pm

VTI may cost you more in transaction fees and bid/ask spread. VTI won't generate capital gain distributions, but it turns out Vanguard is pretty good in avoiding distributions also for VTSAX (precisely thanks to VTI existence).
With VTSAX you can always invest and withdraw the exact amount you want to the cent, not so with VTI (limit orders may not execute).

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Re: VTI vs VTSAX

Post by michaeljmroger » Sun Jul 07, 2019 4:41 am

Thesaints wrote:
Sat Jul 06, 2019 11:08 pm
VTI won't generate capital gain distributions, but it turns out Vanguard is pretty good in avoiding distributions also for VTSAX
It’s not just “pretty good”; my understanding is that VTI and VTSAX are exactly the same in that regard.

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Re: VTI vs VTSAX

Post by Figuring_it_out » Sun Jul 07, 2019 6:33 am

LGLV is another option at TD Ameritrade. Comission free investing. long term chart looks good.

I own it and SPTM. LGLV should be less volitile if the market takes a small correction.

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Re: VTI vs VTSAX

Post by Tamarind » Sun Jul 07, 2019 7:01 am

For TDAmeritrade, I also recommend SPTM. Substantially similar to both VTI and VTSAX, with no commission.

If you wanted to hold only Vanguard products in your account, I would recommend moving the account to Vanguard.

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Re: VTI vs VTSAX

Post by livesoft » Sun Jul 07, 2019 7:13 am

Make no mistake: The Flash Crash of 2010 was a fantastic buying opportunity for folks who use ETFs. Mutual fund share owners had no chance to make extra money that day. And yes, shortly thereafter NAVs of the ETF and mutual fund shares re-aligned.

So if you are in the accumulation phase, you should wish for flash crashes if you can buy during them. They are easy money. But don't save your money wishing and waiting for a flash crash.

If you are not in the accumulation phase, then you should have enough Zen of mind about you that you would not sell during a flash crash. You would also not have any stop limit or stop loss orders either.

Let me ask one more thing: Who thinks they lost any money during a flash crash? Please stand up and raise your hand! Thanks!
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Re: VTI vs VTSAX

Post by ruralavalon » Sun Jul 07, 2019 8:37 am

If you want to use Vanguard funds or ETFs why not do that in a Vanguard account where there will be no transaction fees?

Wherever you have your account, find out which funds or Etfs can be bought and sold with no transaction fees.

Fees matter a lot.
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Re: VTI vs VTSAX

Post by lostdog » Sun Jul 07, 2019 8:47 am

livesoft wrote:
Sun Jul 07, 2019 7:13 am
Make no mistake: The Flash Crash of 2010 was a fantastic buying opportunity for folks who use ETFs. Mutual fund share owners had no chance to make extra money that day. And yes, shortly thereafter NAVs of the ETF and mutual fund shares re-aligned.

So if you are in the accumulation phase, you should wish for flash crashes if you can buy during them. They are easy money. But don't save your money wishing and waiting for a flash crash.

If you are not in the accumulation phase, then you should have enough Zen of mind about you that you would not sell during a flash crash. You would also not have any stop limit or stop loss orders either.

Let me ask one more thing: Who thinks they lost any money during a flash crash? Please stand up and raise your hand! Thanks!
Good point but most people don't sit and watch their etf all day.
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Re: VTI vs VTSAX

Post by livesoft » Sun Jul 07, 2019 8:52 am

lostdog wrote:
Sun Jul 07, 2019 8:47 am
Good point but most people don't sit and watch their etf all day.
True. And the nature of a Flash crash suggests that an Alert sent to one by one's brokerage to one's smart phone would not have been much help as the crash was over before such an alert could be acted upon. OTOH, one would not have to watch their ETFs all day since a flash crash would be all over the news when it happened. One would have to just be in news contact which is something most people should not be doing anyways.

In other words, a flash crash is probably only of consequence to people who have a job trading all day. No one else should care.
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Re: VTI vs VTSAX

Post by arcticpineapplecorp. » Sun Jul 07, 2019 11:49 am

livesoft wrote:
Sun Jul 07, 2019 8:52 am
lostdog wrote:
Sun Jul 07, 2019 8:47 am
Good point but most people don't sit and watch their etf all day.
True. And the nature of a Flash crash suggests that an Alert sent to one by one's brokerage to one's smart phone would not have been much help as the crash was over before such an alert could be acted upon. OTOH, one would not have to watch their ETFs all day since a flash crash would be all over the news when it happened. One would have to just be in news contact which is something most people should not be doing anyways.

In other words, a flash crash is probably only of consequence to people who have a job trading all day. No one else should care.
no one "should" care. But sometimes people "do" care. I watched my co-worker sell all her stock holdings in 2008 because she freaked out watching the market nose dive. it happens, unfortunately.
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Re: VTI vs VTSAX

Post by livesoft » Sun Jul 07, 2019 11:53 am

arcticpineapplecorp. wrote:
Sun Jul 07, 2019 11:49 am
no one "should" care. But sometimes people "do" care. I watched my co-worker sell all her stock holdings in 2008 because she freaked out watching the market nose dive. it happens, unfortunately.
As long as she bought back in March 2009, she did alright.
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Re: VTI vs VTSAX

Post by arcticpineapplecorp. » Sun Jul 07, 2019 12:06 pm

livesoft wrote:
Sun Jul 07, 2019 11:53 am
arcticpineapplecorp. wrote:
Sun Jul 07, 2019 11:49 am
no one "should" care. But sometimes people "do" care. I watched my co-worker sell all her stock holdings in 2008 because she freaked out watching the market nose dive. it happens, unfortunately.
As long as she bought back in March 2009, she did alright.
agreed, but she didn't.

And do you really think that those who sold in 2008 (after all, there had to be lots of sellers who were driving prices down, right?) when the market was down 37% would be buying when the market was down 50%? No. If they weren't buying at a 37% discount in 2008, they certainly weren't buying at a 50% discount in 2009. That's why Warren had to write an op ed telling people to buy stocks (as he was). Because he knew people were doing the opposite.
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Re: VTI vs VTSAX

Post by illumination » Sun Jul 07, 2019 1:53 pm

I pay $2.95 to trade VTI at Schwab and think this its dirt cheap. That's about what I spend in gas to go to the grocery store and prefer Schwab's service over Vanguards. Had a really bad experience with Vanguard, love their funds, don't like their brokerage service. Schwab also gave me 500 free trades, Fidelity had a similar offer. Also, there are other non-Vanguard ETFs I also like to own besides total market.

I think mutual funds are on paper are a better model for boglehead type investing, but I like the "portability" of ETFs and the (usually) lower expense ratios. I feel like I can get my cake and eat it to just buying the ETF at my brokerage. Compared to what a financial planner would cost,discount brokerage fees just don't bother me.

I have also taken advantage when markets go really low with intraday trading with ETFs. I know this is a form of market timing, but I basically have my preferred asset allocation and then "adjust" a bit into equities if markets turn ugly over some news that's usually pretty silly. I absolutely think markets over react on a regular basis and taking advantage of that on the margins can yield a little better return.

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Re: VTI vs VTSAX

Post by TropikThunder » Sun Jul 07, 2019 2:01 pm

illumination wrote:
Sun Jul 07, 2019 1:53 pm
I pay $2.95 to trade VTI at Schwab and think this its dirt cheap.
..........
Schwab also gave me 500 free trades, Fidelity had a similar offer.
You already used your 500 free trades?

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Re: VTI vs VTSAX

Post by TropikThunder » Sun Jul 07, 2019 2:02 pm

livesoft wrote:
Sun Jul 07, 2019 7:13 am
Let me ask one more thing: Who thinks they lost any money during a flash crash? Please stand up and raise your hand! Thanks!
Maybe the people who sold to you? :P

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Re: VTI vs VTSAX

Post by stan1 » Sun Jul 07, 2019 2:10 pm

livesoft wrote:
Sun Jul 07, 2019 7:13 am
Let me ask one more thing: Who thinks they lost any money during a flash crash? Please stand up and raise your hand! Thanks!
There were people who had standing good until cnx stop loss orders on their holdings. It was a bit of a thing for some people back in 2009/2010.

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Re: VTI vs VTSAX

Post by drk » Sun Jul 07, 2019 2:28 pm

illumination wrote:
Sun Jul 07, 2019 1:53 pm
I pay $2.95 to trade VTI at Schwab and think this its dirt cheap. [...] Also, there are other non-Vanguard ETFs I also like to own besides total market.
The juxtaposition of these two views is really rare. Usually people who are diehard about Vanguard funds (e.g., preferring to pay $2.95 than to buy the equivalent SCHB or SPTM for free) don’t have eyes for any non-Vanguard funds.

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Re: VTI vs VTSAX

Post by illumination » Sun Jul 07, 2019 2:55 pm

drk wrote:
Sun Jul 07, 2019 2:28 pm
illumination wrote:
Sun Jul 07, 2019 1:53 pm
I pay $2.95 to trade VTI at Schwab and think this its dirt cheap. [...] Also, there are other non-Vanguard ETFs I also like to own besides total market.
The juxtaposition of these two views is really rare. Usually people who are diehard about Vanguard funds (e.g., preferring to pay $2.95 than to buy the equivalent SCHB or SPTM for free) don’t have eyes for any non-Vanguard funds.
I like Vanguard and tend to prefer their funds, but I'm open to other offerings. By far my largest single positions are VTI and VOO . But I do some amount of tilting.

In my retirement accounts, I use Schwab's version of total market, SCHB, for the free trades. I feel like I can easily convert over to VTI if I feel it's slightly better without any consequences down the road, but it's splitting hairs.

For other non-Vanguard funds, I like small cap value SLYV (expense ratio is lower than Vanguards, and I get free trades with Schwab) and
SDY (dividend artistocrats). I have an older position in SPY that I have just let ride.

I just think in the scheme of things, my brokerage fees are trivial and will pay it for better service. It's like a couple dinners out a year to manage a 7 figure portfolio.

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Re: VTI vs VTSAX

Post by illumination » Sun Jul 07, 2019 3:02 pm

TropikThunder wrote:
Sun Jul 07, 2019 2:01 pm
illumination wrote:
Sun Jul 07, 2019 1:53 pm
I pay $2.95 to trade VTI at Schwab and think this its dirt cheap.
..........
Schwab also gave me 500 free trades, Fidelity had a similar offer.
You already used your 500 free trades?
Yes, I did

I was coming out of a large fixed income position and did not do a "lump sum", but trickled in over time. They went fast. I think because I knew they were free, I was making smaller transactions that I normally would.

Now though that I have my portfolio close to my preferred asset allocation, I make much fewer transactions.

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Re: VTI vs VTSAX

Post by drk » Sun Jul 07, 2019 3:31 pm

illumination wrote:
Sun Jul 07, 2019 2:55 pm
I just think in the scheme of things, my brokerage fees are trivial and will pay it for better service. It's like a couple dinners out a year to manage a 7 figure portfolio.
Don’t get me wrong: there was no judgment, just a comment on the rarity of that combination.

I’m also a Schwab customer and hold some Vanguard funds there, but as soon as the free trades run out I’m going to buy SCHB/SPTM rather than VTI/ITOT. VTI and VOO are lovely, but so are SCHB and SCHX. Over the long run, I imagine they’ll like you more than the like me. :wink:

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Re: VTI vs VTSAX

Post by bugaloo » Tue Jul 09, 2019 12:38 pm

livesoft wrote:
Sun Jul 07, 2019 7:13 am
Make no mistake: The Flash Crash of 2010 was a fantastic buying opportunity for folks who use ETFs. Mutual fund share owners had no chance to make extra money that day. And yes, shortly thereafter NAVs of the ETF and mutual fund shares re-aligned.

So if you are in the accumulation phase, you should wish for flash crashes if you can buy during them. They are easy money. But don't save your money wishing and waiting for a flash crash.

If you are not in the accumulation phase, then you should have enough Zen of mind about you that you would not sell during a flash crash. You would also not have any stop limit or stop loss orders either.

Let me ask one more thing: Who thinks they lost any money during a flash crash? Please stand up and raise your hand! Thanks!
Still in accumulation phase for the next 15 years or so. I also dabble in individual stocks which is why I have a TD Ameritrade account. Maybe VTI makes most sense then because I want to minimize the number of accounts to follow. But I guess I don't understand why VTI is priced at ~$151/share and VTSAX is priced at $73/share. What is the actual $73 quantifying since mutual funds don't necessarily act like shares? In terms of quantity of what i own, how do I know HOW MUCH of each I own? Do I only think of it in terms of monetary value?

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Re: VTI vs VTSAX

Post by bugaloo » Tue Jul 09, 2019 12:40 pm

drk wrote:
Sun Jul 07, 2019 3:31 pm
illumination wrote:
Sun Jul 07, 2019 2:55 pm
I just think in the scheme of things, my brokerage fees are trivial and will pay it for better service. It's like a couple dinners out a year to manage a 7 figure portfolio.
Don’t get me wrong: there was no judgment, just a comment on the rarity of that combination.

I’m also a Schwab customer and hold some Vanguard funds there, but as soon as the free trades run out I’m going to buy SCHB/SPTM rather than VTI/ITOT. VTI and VOO are lovely, but so are SCHB and SCHX. Over the long run, I imagine they’ll like you more than the like me. :wink:
I get no free trades with TD Ameritrade and I wonder why I still use that platform!

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Re: VTI vs VTSAX

Post by White Coat Investor » Tue Jul 09, 2019 12:43 pm

bugaloo wrote:
Fri Jul 05, 2019 1:31 pm
VTI vs VTSAX

I am starting to do monthly purchase of VTI or VTSAX on top of my usual retirement accounts, etc. I tried to do it on my TDAmeritrade account, but I am confused.

VTI - it lets me buy like I am buying shares. I can dictate how many shares I want and it is trading at ~$152/share. I know this is because it is an etf that functions like a security or stock.

VTSAX - It just says minimum amount I can invest is $3000 but it doesn't tell me what it's value per share is. When I google, it says ~$74/share. So how do I know 'how much' I am buying? Or is this the wrong way of thinking when it comes to buying mutual funds?

I think there are added fees if I buy VTSAX thru TD Ameritrade and it is better to buy directly thru Vanguard, but that means I have to open yet another account on top of my TD Ameritrade. Is there a huge advantage/disadvantage of doing VTI vs VTSAX?
If you're buying at TDA, buy VTI. It'll be cheaper for you. If you buy at Vanguard, doesn't matter much.
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bugaloo
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Re: VTI vs VTSAX

Post by bugaloo » Tue Jul 09, 2019 12:51 pm

Tamarind wrote:
Sun Jul 07, 2019 7:01 am
For TDAmeritrade, I also recommend SPTM. Substantially similar to both VTI and VTSAX, with no commission.

If you wanted to hold only Vanguard products in your account, I would recommend moving the account to Vanguard.
Thank you - I will look into this!

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Re: VTI vs VTSAX

Post by bugaloo » Tue Jul 09, 2019 12:52 pm

illumination wrote:
Sun Jul 07, 2019 2:55 pm
drk wrote:
Sun Jul 07, 2019 2:28 pm
illumination wrote:
Sun Jul 07, 2019 1:53 pm
I pay $2.95 to trade VTI at Schwab and think this its dirt cheap. [...] Also, there are other non-Vanguard ETFs I also like to own besides total market.
The juxtaposition of these two views is really rare. Usually people who are diehard about Vanguard funds (e.g., preferring to pay $2.95 than to buy the equivalent SCHB or SPTM for free) don’t have eyes for any non-Vanguard funds.
I like Vanguard and tend to prefer their funds, but I'm open to other offerings. By far my largest single positions are VTI and VOO . But I do some amount of tilting.

In my retirement accounts, I use Schwab's version of total market, SCHB, for the free trades. I feel like I can easily convert over to VTI if I feel it's slightly better without any consequences down the road, but it's splitting hairs.

For other non-Vanguard funds, I like small cap value SLYV (expense ratio is lower than Vanguards, and I get free trades with Schwab) and
SDY (dividend artistocrats). I have an older position in SPY that I have just let ride.

I just think in the scheme of things, my brokerage fees are trivial and will pay it for better service. It's like a couple dinners out a year to manage a 7 figure portfolio.
Could you explain to me what tilting is? I have tried to look this up and learn but don't seem to have a clear understanding.

livesoft
Posts: 71344
Joined: Thu Mar 01, 2007 8:00 pm

Re: VTI vs VTSAX

Post by livesoft » Tue Jul 09, 2019 1:03 pm

bugaloo wrote:
Tue Jul 09, 2019 12:38 pm
But I guess I don't understand why VTI is priced at ~$151/share and VTSAX is priced at $73/share.
When you go to the grocery store, do you wonder why a gallon of milk costs $2.74 and a half gallon costs $1.37? They are both milk, but in different size containers.

The same goes for VTI and VTSAX. They are both Total US Stock Market index, but are in different size containers.
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DaftInvestor
Posts: 5195
Joined: Wed Feb 19, 2014 10:11 am

Re: VTI vs VTSAX

Post by DaftInvestor » Tue Jul 09, 2019 1:38 pm

bugaloo wrote:
Tue Jul 09, 2019 12:52 pm
illumination wrote:
Sun Jul 07, 2019 2:55 pm
drk wrote:
Sun Jul 07, 2019 2:28 pm
illumination wrote:
Sun Jul 07, 2019 1:53 pm
I pay $2.95 to trade VTI at Schwab and think this its dirt cheap. [...] Also, there are other non-Vanguard ETFs I also like to own besides total market.
The juxtaposition of these two views is really rare. Usually people who are diehard about Vanguard funds (e.g., preferring to pay $2.95 than to buy the equivalent SCHB or SPTM for free) don’t have eyes for any non-Vanguard funds.
I like Vanguard and tend to prefer their funds, but I'm open to other offerings. By far my largest single positions are VTI and VOO . But I do some amount of tilting.

In my retirement accounts, I use Schwab's version of total market, SCHB, for the free trades. I feel like I can easily convert over to VTI if I feel it's slightly better without any consequences down the road, but it's splitting hairs.

For other non-Vanguard funds, I like small cap value SLYV (expense ratio is lower than Vanguards, and I get free trades with Schwab) and
SDY (dividend artistocrats). I have an older position in SPY that I have just let ride.

I just think in the scheme of things, my brokerage fees are trivial and will pay it for better service. It's like a couple dinners out a year to manage a 7 figure portfolio.
Could you explain to me what tilting is? I have tried to look this up and learn but don't seem to have a clear understanding.

https://www.bogleheads.org/wiki/Value_tilting_-_stock

rossington
Posts: 604
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Location: Florida

Re: VTI vs VTSAX

Post by rossington » Tue Jul 09, 2019 2:22 pm

But I guess I don't understand why VTI is priced at ~$151/share and VTSAX is priced at $73/share. What is the actual $73 quantifying since mutual funds don't necessarily act like shares? In terms of quantity of what i own, how do I know HOW MUCH of each I own? Do I only think of it in terms of monetary value?
Both, you own X number of shares for each.... for a total value of X.

See this:https://www.investopedia.com/terms/n/nav.asp
"Success is going from failure to failure without loss of enthusiasm." Winston Churchill.

Topic Author
bugaloo
Posts: 78
Joined: Fri Dec 18, 2015 4:34 pm

Re: VTI vs VTSAX

Post by bugaloo » Mon Jul 15, 2019 10:14 pm

02nz wrote:
Fri Jul 05, 2019 1:59 pm
The main advantage of VTSAX in this case would be the ability to set up an automatic investment plan for a set amount every month or whatever schedule you choose. This is possible because with the traditional mutual fund you can buy fractional shares. With VTI you can't do that, so you have to place the order manually (or at least I'm not aware of an ability to do an automatic investment plan with ETFs).
So I guess one needs to be more disciplined about it then.

Topic Author
bugaloo
Posts: 78
Joined: Fri Dec 18, 2015 4:34 pm

Re: VTI vs VTSAX

Post by bugaloo » Mon Jul 15, 2019 10:20 pm

livesoft wrote:
Tue Jul 09, 2019 1:03 pm
bugaloo wrote:
Tue Jul 09, 2019 12:38 pm
But I guess I don't understand why VTI is priced at ~$151/share and VTSAX is priced at $73/share.
When you go to the grocery store, do you wonder why a gallon of milk costs $2.74 and a half gallon costs $1.37? They are both milk, but in different size containers.

The same goes for VTI and VTSAX. They are both Total US Stock Market index, but are in different size containers.
I see - ok thanks for explaining!

MotoTrojan
Posts: 9843
Joined: Wed Feb 01, 2017 8:39 pm

Re: VTI vs VTSAX

Post by MotoTrojan » Mon Jul 15, 2019 10:25 pm

02nz wrote:
Fri Jul 05, 2019 1:59 pm
The main advantage of VTSAX in this case would be the ability to set up an automatic investment plan for a set amount every month or whatever schedule you choose. This is possible because with the traditional mutual fund you can buy fractional shares. With VTI you can't do that, so you have to place the order manually (or at least I'm not aware of an ability to do an automatic investment plan with ETFs).
M1 Finance will allow free automatic investment into ETFs (or individual stocks) via fractional shares. I think it is actually a pretty slick way for someone to invest in an automated manner. You build out your allocation of funds and when your automatic contributions arrive they will go to the underweight holding(s) to bring you back to your target allocation. Nice way for hands-off rebalancing and forces you to buy low(er) automatically.

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