This is my third article about brokerage assessment. In my earlier write-up, I have provided testimonials about Just2Trade and Zecco brokerage. In this report, I’ll review Vanguard Brokerage Services also identified as VBS. Vanguard is identified for low expense mutual fund since the expense ratio is commonly decrease than most mutual fund provider. Not till recently, Vanguard will not be my first selection to trade. The commission for trading is $7.00 per trade for very first 25 trades and $20 for subsequent trades. Nonetheless trading Vanguard ETFs is absolutely free, for any account balance. This is a terrific choice for most passive (invest in and hold) investor.
Background
Vanguard was established on 1975 by John Bogle. John Bogle is known for his creation of index fund for investor. The existing headquarter is located at Malvern Pennsylvania USA. It at the moment utilizes its own clearing Vanguard Brokerage Services as their clearing / asset custodial. Vanguard Brokerage Services, member of FINRA & SIPC, holds and clears all Vanguard client assets. All Vanguard accounts are insured under SIPC (up to $500,000 / $250,000 cash balance) and supplemental Lloyd’s of London coverage (up to $250 million) supplied by its own clearing firm.
What are the particulars?
Vanguard Brokerage Solutions supply Stock, ETF, Bond, Mutual Fund, and CD. As pointed out above, the commission costs for trading is $7.00 per trade up to 25 trades and $20 for subsequent trades. The ideal deal of applying Vanguard is their providing of ETF and Mutual fund. You get cost-free trade to obtain or sell vanguard ETF up to 25 trades per year for every ETF. The following is the particulars costs related to Vanguard brokerage Services:
Items: Stocks, solutions, mutual funds, bonds, CDs, foreign securities, insurance coverage, commercial paper
Marketplace Orders: Totally free & $7.00 up to 25 trades per year, subsequent $20.00.
Limit Orders: Free & $7.00 up to 25 trades per year, subsequent $20.00
Mutual Funds: $35.00 for transaction-charge funds. NTF funds out there.
Options: $30.00/trade+$1.50/contract
Minimum to Open: $3000 ($ VBS)
Account Inactivity Charge: $.00 though $20.00/yr for maintenance
Account Maintenance charge: $20.00/year (balance < $50K)
ACAT In/Out: $0.00
Maximum Margin Rate: Unknown
How to open Vanguard Brokerage Services account?
Opening account is very straight forward by filling its online application. Most people will get their account information within 10 minutes after application submission. To apply for margin account, option trading account and Money Market Sweep Account, you will need to fill separate form. You need to mail in the forms for this application. For foreigner, you might need to check with Vanguard customer services. cbs-global.com/manda/ is possible to open an account with filling the application form manually.
My Experience
Opening Vanguard account is fast and easy. It took me 10 minutes to fill the application online and open my account. ACH electronic transfer also can be setup through online easily. Vanguard also offers various mutual funds as well as ETF for my account. One of the most famous things with vanguard is the low expense ratio of the funds. This can be very significant for long term investor most of the funds have lower than 0.50% expense ratio. For example Vanguard Total Stock Market ETF (VTI) only has 0.07% expense ratio. This means if you have invested $10,000 in this ETF, your expense for holding this ETF is only $7.00. There are currently 46 ETFs are offered by Vanguard.