BC Wiki - Investing Outside of Vanguard

Category: finance

Schwab

Bond Funds

http://quotes.morningstar.com/fund/SWLBX/f?t=SWLBX

Schwab Total Bond Market SWLBX


via: http://investingguy.blogspot.com/2010/01/comparison-of-vanguard-charles-schwab.html

“Schwab’s own Total Bond Market Index, SWLBX, is not used here for a couple reasons. First, it has a fairly high 0.55% net expense ratio (Schwab’s weakness is definitely bond funds). Secondly, looking at the past performance, it clearly wasn’t tracking the index it was supposed to (Barclays Capital U.S. Aggregate Bond index.) Take a look at the comparison of SAMIX, VBMFX, and SWLBX in 2008 here. There is certainly some variation between SAMIX and VBMFX, but SWLBX isn’t even closely correlated with those two. For the year of 2008, the Schwab bond fund was down nearly 9%, while the other two were up just over 1%. Investigating it further, apparently a law firm is investigating the fund and its managers for “possible misrepresentations, omissions and/or breaches of fiduciary duties” as it was investing in high risk CMOs as opposed to the stated objectives. Certainly, past performance is not indicative of future results, but any fund manager that made that mistake (whether purposefully or not) should not be trusted with your money”


via: http://www.bogleheads.org/forum/viewtopic.php?f=1&t=112327

“Tracking the bond index is apparently not all that easy. Neither Vanguard nor Fidelity was anywhere near as bad as Schwab, though.”

“Schwab appears to have changed their philosophy on at least some of their bond funds. Once upon a time they covered their higher e/r by going to lower quality bonds. After being burned by the ‘08 massacre and the Schwab Yield Plus lawsuits they appear to have reduced their e/r by subsidizing the funds and have therefore increased their credit quality and reduced their tracking error. For example their short term bond fund is now an index fund.”

Schwab’s retirement calculator: http://www.schwab.com/public/schwab/investing/retirement_and_planning/retirement/retirement_calculator

Transfer-Out Fees

Vanguard

There are no fees for transferring out or closing an IRA, no fees for trading Vanguard ETFs, no fees for closing a brokerage account.

Schwab

Charles Schwab charges a $50 transfer-out fee.

Morgan Stanley

USAA

There is no fee to transfer out a brokerage account, but a $20 IRA closing fee.

TIAA-CREF

American Century

E*Trade

T Rowe Price

American Funds

Fidelity

If a potential client isn’t rich enough, it won’t be very profitable for a financial advisor to work with them. Fidelity-affiliated advisors can refer unprofitable clients to a partner in exchange for a 0.35% cut of the annual revenue earned from them.

Category:Finance FORCETOC