Basically, what you are saying is this, one fund manager charges $250.. but you get 5% growth after expenses. The other fund manager charges $3, but you get 5% growth after expenses. What exactly is the difference to you what they charge?

Exactly my point, it makes sense if you are in the US. But unless someone can recommend a reputable low-cost US broker that doesn't demand a ridiculous amount of money just to open an account, we're stuck with a $30 minimum brokerage



Then you would just be lying to the government?

This post has been edited by wodenus: Jun 24 2014, 12:13 AM

Depends what you call a ridiculous amount of money - less than $10K isn't really worth it after paying bank charges

Currently 30% max withholding, apparently at the end of the year you can file a 1040NR form to get half of that 30% back.

How reputable is Etrade?

Fantastic.. so if I do DCA/VCA I have to put in $10K a shot.. otherwise it'd not be worth it? and on top of that I have to file a form to get 15% taxed from the dividend, otherwise it's 30%?

I wouldn't say 30k's a lot of money- it is Ringgit after all :V
Okay lah, say 1-2 years savings for average joe. If you can't leverage the economies of scale yet, put it in a local UT then... the management fee rape isn't too obvious in a short timescale, but the front load is.

For me I see the case there tho. Putting in six digits in a three/four fund allocation, set it and forget it, and enjoy no front load + minimal management costs.

Oh and you can only declare residency if you fulfill certain eccentric conditions. Certainly not lying. And doesn't help the 30% dividend case here. Most countries with US tax treaties are ones that tax their citizens worse- hence the gov stepping in to prevent dual taxation.

Just because you transfer in $10k doesn't mean you have to invest it all in one go. Can have a higher balance and just top up every month (whatever your schedule)

X.E.D,

https://personal.vanguard.com/us/funds/snap...ntExt=INT#tab=0

VT annual expense is 0.18%.

Dreamer

Ha if I had a few million ringgit lying around, I'd buy property..



Maybe in the US now that the property market there is pretty much dead. But here.. high-end property is dead cheap



Now I'm curious, what if you had money in a brokerage account, that you used to buy into a mutual fund, but then the brokerage goes under, what happens to the amount in the brokerage account, and the amount in the fund?

Just because you transfer in $10k doesn't mean you have to invest it all in one go. Can have a higher balance and just top up every month (whatever your schedule)

Just because you transfer in $10k doesn't mean you have to invest it all in one go. Can have a higher balance and just top up every month (whatever your schedule)

So it is, but it does not seem to translate to noticeably better returns.

The excess funds parked in the brokerage are in my case insured by FDIC (www.fdic.gov)

The fund is just held in that brokerage, if it was to go under and taken over by a new brokerage it'd get moved to there I imagine. Only if every company that fund holds was to go bankrupt your money would be gone !

Sure in your case it is. But if you are not a citizen, all your funds are gone right?



Any idea what happened in Lehman Bros. case? especially to their foreign accounts?

wodenus,

The money is held in TRUST independent of whether the person is a citizen or not.

It is THE SAME as your stock is held in CDS A/C in Malaysia. Your broker do not own those stock in your CDS A/C. You do.

Whatever your question is. It applies THE SAME in Malaysia. The ONLY DIFFERENCE is USA has the larger scale and better transparency.

Dreamer

Yet for people in between who prefer liquidity and ease of mind, ETFs are pretty much right sized.
I can't just snap my fingers and sell off a bungalow in KL to pay for tuition at Haas, for example.

(Also, the US is doing pretty good in urban properties. SFBay, Seattle etc... crazy rents these days!)

Brokerages have SIPC + internal insurance coverage. Not as much of a wild west as you think.


That's pretty good for a world index (something that Schwab doesn't have) but Schwab has <.1% ERs on the majority of its domestic offerings. Just small cap intls going slightly higher.

I guess I don't like how Vanguard doesn't have a physical presence; if things go wrong and unchecked it's not exactly easy to rectify stuff.

Already answered by Dreamer , and I'm not a US citizen - don't know what gave you that impression.

Lehman case I don't know much about, but not very relevant to this discussion

This post has been edited by rjb123: Jun 24 2014, 12:50 AM

rjb123,

http://www.sipc.org/

SECURITIES INVESTOR PROTECTION CORPORATION

Brokerage A/C is protected by SIPC.

Bank A/C is protected by FDIC.

Dreamer

FYI, from my TDAM account (the cash balance)

X.E.D,

VT is an ETF. You can buy and sell it just like stock. As long as your Schwab is a stock brokerage A/C, you can buy it.

Dreamer

This post has been edited by dreamer101: Jun 24 2014, 12:54 AM