ETF VAS reduce MER to 0.10%

Discussion in 'Shares & Funds' started by Zenith Chaos, 25th Jun, 2019.

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  1. Redwing

    Redwing Well-Known Member

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    Hi @LeeM

    Have a search of post by @Terry_w I'd be surprised if there's not something there with regards to structuring
     
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  2. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    I don't know what the difference between an individual and a sole trader is as legally they are the same. A company is a separate legal person and could only be used if a company was the 'person' buying the shares - which may not be a good idea.
     
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  3. LeeM

    LeeM Well-Known Member

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    When I applied to open an account at Vanguard, the online form asked me to choose one of these types: Screen Shot 2019-10-22 at 9.37.25 am.png
     
  4. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney Business Member

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    strange in deed.

    They have a SMSF down which is a trust, but no field for other trusts. They distinguish between sole traders and individuals - ask them what the difference is.
     
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  5. LeeM

    LeeM Well-Known Member

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    Yeah, I got really confused and didn't know which one to tick. So I posted the questions on this forum & lucky you're helping me to clarify this. Thanks Terry,
     
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  6. marty998

    marty998 Well-Known Member

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    Trustee of a trust is generally an individual or a company? Perhaps they don't care or need to know about beneficiaries...
     
  7. oracle

    oracle Well-Known Member

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    From article today in AFR

    Vanguard again not taking the lead. Very disappointing.

    Read full article here (behind paywall)

    Investors in broad based index ETFs continue to benefit. There has never been good time to be an index investor.

    Cheers,
    Oracle.
     
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  8. oracle

    oracle Well-Known Member

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    ETF war heats up except no participation from Vanguard :mad:

    Screenshot_20230221-194450.png

    Australia 200 ETF

    My best guess is VAS reduces fees from 0.10% to 0.06%

    Cheers
    Oracle
     
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  9. oracle

    oracle Well-Known Member

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    Still no word from Vanguard regarding their fees on VAS but they have increased their fees on VEU :eek: - ASX Announcement here

    It is very odd ETFs half the size of VAS (IOZ and A200) are cutting fees to be 50% cheaper but Vanguard is silent. It doesn't look good.

    Vanguard Australia is definitely not leader in providing low costs investing options as it once used to be. Profits before investor interests. Jack Bogle would be frowning in his grave :mad:

    Cheers,
    Oracle.
     
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  10. oracle

    oracle Well-Known Member

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    Finally, Vanguard VAS fees reduced from 0.10% to 0.07% (not complaining, I already feel rich :D)

    See here

    Cheers,
    Oracle.
     
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  11. Cadbury99

    Cadbury99 Well-Known Member

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    Still way more expensive than A200 (0.04%) or IOZ (0.05%). Just STW left as the outlier at 0.13%.
    Vanguard obviously not wanting to compete on price alone.
     
  12. Sgav

    Sgav Well-Known Member

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    Not sure if it was on here, but I recall reading that VAS offer security lending which provides an average circa 0.02-0.03% return, which would help explain why they may still be competitive given the slightly higher MER.

    Found it: Reddit - Dive into anything

    upload_2023-6-8_17-26-8.png
     
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  13. Cadbury99

    Cadbury99 Well-Known Member

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    So Vanguard lend securities which is not without risk (albeit fairly low) and keep the profit from taking the risk for themselves and pass any losses from that onto me. (A cynical view I know). Doesn’t make me think better of Vanguard.
     
  14. Sgav

    Sgav Well-Known Member

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    Think of it this way, Vanguard now cost 0.03% or so more than competitors; however, they return an extra 0.04-0.05% in return each year, because they do something the others don't.

    Therefore, one could argue VAS is cheaper than the others. Possibly a long bow to string.
     
  15. Phil Pogson

    Phil Pogson Member

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    So if you have million invested in A200 or VAS the price difference would be $300 more in VAS per year than A200. Am I missing something else or is this seriously that important?
     
  16. The Falcon

    The Falcon Well-Known Member

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    No you aren’t missing anything. The discussion over a few bps is amazing.
     
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  17. The Falcon

    The Falcon Well-Known Member

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    No. Returns from lending accrue to the fund.
     
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  18. SatayKing

    SatayKing Well-Known Member

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    But most of us are never happy unless we're complaining.

    Grumble away good pps . Does wonders for the spleen apparently.
     
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  19. Cadbury99

    Cadbury99 Well-Known Member

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    That’s my point, Vanguard take an additional fee over say A200 of 0.03%. Someone tried to justify this by saying the extra was accounted for by the income from securities lending. My response to that is that the additional fee is guaranteed but the additional income (or potential cost) is not.
    I know it’s small change unless you have a very large VAS holding but if it wasn’t important why did Vanguard bother to drop the management fee?
     
  20. SatayKing

    SatayKing Well-Known Member

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    Cause they can and makes 'em look like real nice guys and gals?
     
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