Buying Vanguard ETF's via ASX or direct - pros and cons?

I used to own the wholesale versions as well until I switched to ETF's after the unpleasant CGT surprise in 2020.

Once you have a significant amount invested, the unit price factors is really tiny. Eg at most $90 will be left as a remainder from a DRP uninvested. I actually recently turned off DRP across VAS/VGS/VISM/VAE and now just roll all the distributions + savings into my monthly single buy of whichever ETF is furthest from my asset allocation for simpler cost basis tracking.

I also liked the EOFY tax statement until I realised Computershare supplies the same for the ETF's and in both cases you are still responsible for tracking your own cost basis when you sell down the track.

 

So will VDGH result in this CGT surprise the article in your link wrote about? It said it will, however in the Reddit post that inspired the article, the author wrote how they were shifting to VDGH to avoid it! So I'm really confused now about whether to go VDGH or not.

 

Yes it will as the underlying funds inside VDHG are wholesale funds rather than the ETFs (VAS/VGS/VGAD/VGE etc)

It tends to be most evident when there are liquidity issues leading to lots more selling than buying which triggers the realisation of capital gains.

If VDHG is being traded on the secondary market without market makers needing to provide liquidity there is no CGT realized. I don't know how to quantify it other than my own $3600 tax bill last year when I didn't sell anything.

 

Frightening. I assume you roll your own then and DIY all the rebalancing?

 

Vanguard fees updated 18 August 2021 - https://www.vanguard.com.au/persona...al-investor-fees-changed-since-18-august-2021

 

Refreshing this one,

If a plan is to purchase only VGS and VAS for long term holding, with additional purchases made quarterly, is there any obvious downside with this new fee structure? Comparing Vanguard with Selfwealth for example, brokerage fees are a flat fee of $9/$9.50 respectively, and I assume that the annual management fees are the same for like products?

So on the face of it, Vanguard is cheaper, but wondering if I am missing something,

Thanks,

 

Vanguard wholesale fund

Plus google search.

This decision is situation dependent, so any answer is going to be flawed.

The only advantage of the fund IMO is it allows you to invest small quantities without brokerage. Recently with Stake and other cheap brokerage options this advantage has practically disappeared.

 

Vanguard High Growth is the core of our portfolio. I have the managed fund.

However, I am seriously considering switching to the ETF.

At my semi-retired stage I don't do regular contributions so the BPay thing is unimportant.

It may seem trivial to most, but what bugs me about the managed fund is how old-fashioned it feels.

My core holding is set and forget, but I still like to see how things are going in real time, and would like the flexibility to do something even though I don't plan on doing anything.

I'm a control freak and tt is a psychological thing.

I can do the switch without CGT implications thanks to the current dip. But I'm not sure I'd do it through Vanguard Personal Investor.

Vanguard still has no mechanism to simply switch from managed fund to ETF. I have sell the lot, wait for them to transfer the funds to my bank account, then transfer the funds into my Personal Investor account, then buy the ETF.

Last time I did something like this it took a week and a half for everything to go through.

It will be easier to do it through Nabtrade. Plus I will then have everything in one spot.

What is holding me back is the temptation to tinker once I have the loot in my hot little hands. Do I really want the bond component? The EM component? Etc etc.

 

Stake is cheaper than VPI in terms of Brokerage. VPI does not have CHESS also. Both Stake and Selfwealth has CHESS.

 

CHESS with HIN alone is reason to go ASX avenue as opposed to direct. asset segregation os key

 

Thanks for the replies, I am in no rush atm, so it nice to get some pointers for some extra reading

Doing some digging into stake, it seems like a pretty straight forward option for my purpose. I was put off by the lack of real time reporting with stake but now realise I could just setup a commsec account for this,

 

Use a CHESS sponsored broker. Risk of pooled vehicle is too high.

 

Did anyone else get the email from Selfwealth to accept new terms and conditions:-


"Selfwealth is pleased to advise that we are transitioning Australian equities execution, clearing and settlement provider, to FNZ Custodians (Australia) Pty Ltd (FNZ Securities) (PID 3772) from OpenMarkets Australia Limited (PID 1137) (OpenMarkets)."

Me and my wife both with SW but she didn'' t get!

 

It is so true and hiven my wife dien't get made me more suspecious !