Questions about Buying First Etf

funnysht on 25/02/2021 - 19:04

Hey guys
Had some newbie questions

I'm a planning to invest in ETFs like in 1-2 months after learning
I had 2 questions about vanguard vs selfwealth

1)After reading up on these two it seems if i'm going to make frequent investments
vanguard personal investor would be better but I'm a bit confused about the fees:
Vanguard is 0.2% on portfolio plus say for vanguard australia share etf is 0.1% annually
However with selfwealth say if i was going to buy the same etf would i just be paying
$9.50 or I will still pay $9.50 + the 0.1% annually vanguard charges?

2)I understand the i have to do the W8BEN forms when the ETF is domciled in the US.
How would i find that info: e.g was going to look into SPDR S&P 500 ETF, Betashares
NASDAQ 100 (NDQ) and ishares Global 100 (IOO).Would these need to have W8BEN done?
I understand vanguard lets you know when it needs to be done but does selfwealth?

Thanks!

Financial

Comments

HeavenlyHammocks on 25/02/2021 - 19:10

+1
Sounds right.

Selfwealth would let you know to do the W8-BEN, I believe.

I use Selfwealth for ETFs and regular shares with no issues.
- funnysht on 25/02/2021 - 19:21
  
  so for 1.buy the same etf would i just be paying
  $9.50 or I will still pay $9.50 + the 0.1% annually vanguard charges?
  
  former or latter?
  - hj0809 on 25/02/2021 - 19:42
    
    +1
    
    The annual ETF fees will come out of the returns of the ETF (management fee deducted from the NAV itself).
    
    So you will only pay $9.50 share trading fee
Seraphin7 on 25/02/2021 - 20:09

In both cases you will pay the 0.1% or 0.2% (or whatever it is), but you won't see it. It will be deducted from the value of your investment and then the NAV determined after that.

The $9.50 you will have to explicitly pay for the broker to buy the ETF for you (with another $9.50 to pay on sale).
- funnysht on 25/02/2021 - 20:28
  
  so basically the only fee difference would be 0.2% vanguard annual fee vs the one off selfwealth $9.90 fee?
  - Seraphin7 on 25/02/2021 - 20:47
    
    A correction to my original post … I've just had a brief look at the PDS and noted the personal investor product is an IDPS (I'd previously assumed it to be a master trust arrangement).
    
    As an IDPS that (as relevant to your example) charges a 0.2% p.a. administration fee on the value of your investment (whatever you happen to be invested in) and you will need to explicitly pay for this via the cash account embedded within the IDPS. For Vanguard ETFs they allow you to trade without brokerage.
    
    The ETF will still be charging a management fee within it (apparently the 0.1% p.a. you've referenced). This will be charged via the NAV as I originally posted.
    
    It appears then (all else being equal), that you have a choice to pay 0.2% p.a. with no transaction costs, or the $9.50 each time you buy and sell.
    
    The tradeoff then seems to be, if you want to invest small amounts regularly, the "personal investor" product may be cheaper. if you want to just plonk a large amount on in one hit, the Selfweath may be cheaper.
    - funnysht on 25/02/2021 - 21:47
      
      thanks thats what i thought, but then also you need to factor in 0.2% per annum- so say if you keep it for 5 years- thats 1% !!!
orangetrain on 26/02/2021 - 12:13

ETFs are free with superhero at the moment if you're concerned about cost.

Questions about Buying First Etf

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