Market advice

dirtymoose · Apr 7, 2016

Hey guys,

I have a few bucks I want to invest. Looking at mutual funds, index and etfs.

I have already have a 401k set up. I want this account to be more flexible. I want to be able to move this money if need be.

I've had an American Funds account set up in the past via my cfp/cpa with class c shares.

Where or what should I do? Should I open an on line trading account? If so, which is best for these transactions?

Can I even buy something like American Funds mutual fund anywhere but thru them?

Any help is appreciated.

Matt

PatsFan1283 · Apr 7, 2016

American Funds generally charge high load fees followed by industry average expense ratios. Not really a fan.

Go with Vanguard ETFs as long as you won't have the temptation to sell because of the improved liquidity of ETFs.

Discount brokers you can buy any and all mutual funds and ETFs.

DNoonan · Apr 7, 2016

A young guy I work with that is starting to dabble in the market sent me this link. I have not used, but I understand they provide free trades.

https://www.robinhood.com/

I have been buying the IYC which tracks US consumer services companies.

dirtymoose · Apr 7, 2016

PatsFan1283 said:
American Funds generally charge high load fees followed by industry average expense ratios. Not really a fan.

Go with Vanguard ETFs as long as you won't have the temptation to sell because of the improved liquidity of ETFs.

Discount brokers you can buy any and all mutual funds and ETFs.

Where would the best place to but vanguard etfs? I already have an IRA with them, if that helps. Or is something like e-trade?

Also, I do want to have some to buy and hold but how bout if I want some to buy and sell, in a short term sense? Short term being, maybe a year or so? Something that's not specificallyfor rretirement.

Matt

dirtymoose · Apr 7, 2016

DNoonan said:
A young guy I work with that is starting to dabble in the market sent me this link. I have not used, but I understand they provide free trades.

https://www.robinhood.com/

I have been buying the IYC which tracks US consumer services companies.

I will look into both. For is the IYC doing?

DNoonan · Apr 7, 2016

i am pretty sure you should be able to buy vanguard ETF's through just about any established brokerake service like e-trade, etc

PatsFan1283 · Apr 7, 2016

Trading ETF's is really hard. Just being honest, it is not easy to time the market in the short-term.

There really is no best place to buy the ETFs. Your IRA or a regular taxable account is fine. Can use schwab, etrade, scottrade, etc for that. Google search should give you some comparisons. If you are just buy and holding ETFs there isn't a huge difference. Even if you did want to move stuff around every 3-6-12 months, then those options would all work.

Read a little on tax-efficient investing. Should be a good wiki entry on the basics. Bigger dividend payout ETFs are better in a tax-deferred account like IRA and lower dividend like a technology ETF is better in a taxable account since it won't throw off much income.

MattyMatt · Apr 7, 2016

DNoonan said:
i am pretty sure you should be able to buy vanguard ETF's through just about any established brokerake service like e-trade, etc

Correct, I buy my Vanguard ETF, such as VTI, through Scottrade...it's the normal $7 trade fee, and I do recommend it, although I typically do ETFs in the IRA account...good luck

dirtymoose · Apr 7, 2016

Thanks again, and please, tell the truth, I don't care how harsh it is. IF trading ETFs is difficult, would a mutual fund be my best bet? And can these also be bought and traded at e-trade, Scott trade, ect....?

Ricboff · Apr 7, 2016

dirty moose said:
Thanks again, and please, tell the truth, I don't care how harsh it is. IF trading ETFs is difficult, would a mutual fund be my best bet? And can these also be bought and traded at e-trade, Scott trade, ect....?

sounds like you're new to investing. If that's the case, DO NOT trade. (trading and investing are different) If going forward, its an area that interests you and you're PASSIONATE about ? then you have to spend time educating yourself, which MOST DEFINITELY must include the psychology of trading . If you think you'll need these funds in the short term (within 1-2 yrs or so) park the money in a GIC instead. Why take the risk? If this is long term money not to be touched for 10+ yrs , go ahead and buy a Vanguard etf(s). Add to it on market dips (as an example, if the market drops 10%, buy-- see it as buying on sale). Don't let fear guide you.

if you have no confidence in USA going forward, don't invest in the market. If you think the world is coming to an end, don't invest in the market.

PatsFan1283 · Apr 7, 2016

You don't have to trade the ETF. You can buy and hold it.

And the answer is yeah, they can.

PatsFan1283 · Apr 7, 2016

Ricboff said:
sounds like you're new to investing. If that's the case, DO NOT trade. (trading and investing are different) If going forward, its an area that interests you and you're PASSIONATE about ? then you have to spend time educating yourself, which MOST DEFINITELY must include the psychology of trading . If you think you'll need these funds in the short term (within 1-2 yrs or so) park the money in a GIC instead. Why take the risk? If this is long term money not to be touched for 10+ yrs , go ahead and buy a Vanguard etf(s). Add to it on market dips (as an example, if the market drops 10%, buy-- see it as buying on sale). Don't let fear guide you.

if you have no confidence in USA going forward, don't invest in the market. If you think the world is coming to an end, don't invest in the market.

If you think the world is coming to an end just invest in catastrophic insurance. Collect that premium and then once 1,000 nukes go off, nobody is gonna be asking you to pay out.

Maybe Buffett is trying to tell us something?

Ricboff · Apr 7, 2016

a mutual fund is actively managed (unless its an index fund). You're paying for the management team, their expertise. Most mutual fund managers DO NOT beat the index. For many, hence , buying an ETF or index fund and letting time do its thing is a good way to go

dirtymoose · Apr 7, 2016

I would be brand new to trading, I guess. I for sure don't have the time right now to learn. So I guess I'm looking for investments.

Sounds like I should just keep sticking money into my 401k. Which I am. 20% a week.

I just have some free money sitting in an online savings account, making some awful interest rate.

Would buying an index with with that money be my best choice? And holding it. Or buy and hold some etfs?

And what is a GIC?

dirtymoose · Apr 7, 2016

I guess I want a non retirement account. Best way to put it.

dirtymoose · Apr 7, 2016

Also, since I already have the vanguard account set up with my 401k, would it make sense to buy whatever I plan on buying thru them?

Ricboff · Apr 7, 2016

dirty moose said:
Also, since I already have the vanguard account set up with my 401k, would it make sense to buy whatever I plan on buying thru them?

makes sense to me.

call them up, ask for guidance. Tell them you're new to investing . Tell them you have a 401K with vanguard and are looking at further savings via non-retirement account. They are there to HELP.

https://investor.vanguard.com/home/

but, this additional cash you have, will you need the funds in the short term? (1-2 yrs or so) Or is this further retirement savings. If this is short term, be careful- you can LOSE money in the short term

sounds like you're a saver. Kudos. Mr Bogle is the founder of Vanguard, he recently said in late 2015 that he thinks the average market return for the next decade will be 4%/yr. Ouch, let's hope he's wrong. You are wise to INCREASE savings rate.

CHOPTALK · Apr 7, 2016

ETFs can be a great buy and hold tool as long as they are not leveraged. DO NOT use leveraged ETFs for buy and hold purposes.

Those are for short term trades only due to decay.

Betallsports · Apr 7, 2016

on the short term I would think, find a good solid Stock that pays a decent Dividend

to me, etf's are ... go Long or go home

MattyMatt · Apr 7, 2016

Betallsports said:
on the short term I would think, find a good solid Stock that pays a decent Dividend

to me, etf's are ... go Long or go home

Cant argue with dividends...I go on and reinvest them, how bout you?

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