Comments on: Cheapest S&P 500 Index Funds

By: Monica

Monica — Thu, 20 Oct 2011 12:47:17 +0000

Hi,

Could you help me understand what the difference between Tickers VFINX and VOO are?

I think VFINX is a mutual fund with the 0.18% expense, and the VOO is an ETF with only 0.06% expense.

Could someone just buy the VOO instead of the VFINX through a Roth IRA account? (I think the only the $3K minimum and a $20 annual fee for having a money market account open.)

What do you think? Will this work?

Or is there some other fee or restriction of which I’m unaware?

Thanks you for any information!
Monica

By: Andrew

Andrew — Thu, 09 Dec 2010 14:58:31 +0000

Check out Vanguard’s Admiral shares – now 0.07% with a minimum investment of 10K.

By: Jim

Jim — Fri, 01 Jan 2010 18:50:55 +0000

The 0.33% expense ratio is on the high side for an index fund, the major mutual fund companies charge less than half that.

By: Ben Haygood

Ben Haygood — Fri, 01 Jan 2010 16:36:56 +0000

What about United Association S&P 500 Index Fund (UAIIX) ?? This is supposed to be an inexpensive index fund that mimics the S&P 500.

By: ktk

ktk — Wed, 30 Dec 2009 12:06:27 +0000

no one has replied to your question about 10 year returns. s&p 500 funds dont really seem like a great investment. there are many bond funds that have 6-10% 10yr returns that seem “safe” and have less than 1% er.

By: Dan Cuprill

Dan Cuprill — Wed, 21 Oct 2009 23:01:26 +0000

Keep in mind that the key to successful investing is using more than one index. As you expand into small stock index funds, small value, international, etc., fees will vary. I do feel that DFA provides the the best variety of asset class funds that allow for thorough diversification.

By: Martha

Martha — Fri, 09 Oct 2009 20:11:27 +0000

Thanks for the tip Juan! I just checked it out.

By: Greg Retzloff

Greg Retzloff — Tue, 06 Oct 2009 21:53:50 +0000

The figures for VFINX, FSMKX and SWPPX are from Morningstar as of 10/02.

By: Juan

Juan — Tue, 06 Oct 2009 15:19:18 +0000

good point on the after tax return. All these index funds have negative returns for 10 years makes it harder to hold on to the thesis of buying index funds for the long run.

The returns you posted are total returns correct?

By: Juan

Juan — Tue, 06 Oct 2009 15:15:43 +0000

Try the SVSPX in Ameritrade No Load or Transaction Fees! If you put it in a Roth or Traditional your minimum investment is only 250!

By: Juan

Juan — Tue, 06 Oct 2009 15:09:06 +0000

Its better than the S&P its the total stock market. Its like buying the 30 Dow Titans and and the S&P’s 500 companies plus the techonology weighted NASDAQ. It tends to outperform over the very long term any of the major indices

By: Juan

Juan — Tue, 06 Oct 2009 15:06:33 +0000

Expensive though at a 100plus a share not many can afford to accumulate on a monthly basis plus commisions. Where as with the mutual fund the price is much lower and you buy fractons of shares plus a lot of online brokerages offer no transaction fees on the above mentioned index funds.

By: Jim

Jim — Sat, 03 Oct 2009 13:38:38 +0000

You can purchase funds without signing up with the company but you would usually have to pay a transaction fee, so the cheapest way is to go with the actual company.

By: JJ

JJ — Sat, 03 Oct 2009 04:36:37 +0000

I assume the only way to purchase these funds is to sign up with the actual company right?

So if I want to invest in Schwab S&P 500 I have to open an account at Schwab?

By: Greg Retzloff

Greg Retzloff — Sat, 03 Oct 2009 01:45:31 +0000

Expense ratios are important in the final performance of any fund, but so are taxes. These are reflected in the tax-adjusted return figure. Over the last ten years, the Vanguard 500 fund (VFINX) posted a tax-adjusted return of -0.61%, the Fidelity 500 fund (FSMKX) posted -0.82%, and the Schwab 500 fund (SWPPX) posted -0.80%. The 10-year tax-cost ratio of the Vanguard fund is 0.38%, the Fidelity fund 0.58%, and the Schwab fund 0.59%. When comparing the historical performance of funds, always use the tax-adjusted return figure 9which also factors in trading costs).

The tax-adjusted return and tax cost ratio figures for these funds can be found on Morningstar by plugging the fund symbol into the quote box and clicking the “Tax” tab.

Vanguard pioneered the index concept, developd it, and stuck with it for decades before it became the strategy of choice for many. For index mutual funds, they are the best!

And no, I don’t work for Vanguard!