Great News For Investors In Vanguard Mutual Funds!
Vanguard has just announced plans to reduce the account balance requirements in more than 60 of its mutual funds that offer Admiral shares, and this will become effective on May 10th.
Vanguard began offering Admiral shares in year 2000 to reflect economies of scale at its larger and long-standing accounts. As an example of what this change meant to shareholders in the Vanguard S&P 500 Index Fund, the Admiral Share class has an expense ratio of 0.09%, while the Investor Shares class levies an expense ratio of 0.18%.
Under the new requirements, investors with a fund account balance of at least $100,000 will be eligible for the cheaper Admiral share class. Previously, the minimum was $250,000, or $150,000 for accounts at least three years old.
Since 2000, accounts of $50,000 that have been in existence for 10 years also qualify for the Admiral shares.
Vanguard said it will automatically convert accounts of $100,000 or more to the lower cost Admiral share class starting in July, although shareholders can make the switch before then.
Vanguard will also add Admiral Shares to the $8.6 billion Vanguard Inflation-Protected Securities fund in June.
These changes by Vanguard are, no doubt, their reaction to the marketing ploy by Fidelity Investments this past March when it reduced expenses on some of its own index funds. So we can see that a bit of rivalry amongst mutual fund competitors can and does bode well for the average investor!
--------------------------------------------
If you were absent from our meeting last evening then you missed a very informative session about Options, as provided by Mr. Jim Bittman, from the Options Industry Council in Chicago. In fact it was so interesting that we hope to have another meeting in the Fall of this year on Covered Calls.
* * * * *
Vanguard began offering Admiral shares in year 2000 to reflect economies of scale at its larger and long-standing accounts. As an example of what this change meant to shareholders in the Vanguard S&P 500 Index Fund, the Admiral Share class has an expense ratio of 0.09%, while the Investor Shares class levies an expense ratio of 0.18%.
Under the new requirements, investors with a fund account balance of at least $100,000 will be eligible for the cheaper Admiral share class. Previously, the minimum was $250,000, or $150,000 for accounts at least three years old.
Since 2000, accounts of $50,000 that have been in existence for 10 years also qualify for the Admiral shares.
Vanguard said it will automatically convert accounts of $100,000 or more to the lower cost Admiral share class starting in July, although shareholders can make the switch before then.
Vanguard will also add Admiral Shares to the $8.6 billion Vanguard Inflation-Protected Securities fund in June.
These changes by Vanguard are, no doubt, their reaction to the marketing ploy by Fidelity Investments this past March when it reduced expenses on some of its own index funds. So we can see that a bit of rivalry amongst mutual fund competitors can and does bode well for the average investor!
--------------------------------------------
If you were absent from our meeting last evening then you missed a very informative session about Options, as provided by Mr. Jim Bittman, from the Options Industry Council in Chicago. In fact it was so interesting that we hope to have another meeting in the Fall of this year on Covered Calls.
* * * * *
posted by Bob Moser at
6:44 PM
1 Comments:
Plug for his books:
http://www.amazon.com/exec/obidos/search-handle-url/index%3Dbooks%26field-author%3DJames%20B.%20Bittman/
I won one of these last night as well :)
By
erik, at 1:01 AM
Post a Comment
<< Home