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Can I Buy Vanguard Funds Through Etrade? Does Etrade Offer Fidelity Mutual Funds/ETFs (Retirement, Stock, VTI, VTSAX, Index and S&P Funds)?



Investing in Vanguard and Fidelity Mutual Funds on Etrade


Our readers are sometimes asking us the following questions:

- Are Vanguard (Fidelity) mutual funds and ETFs offered on Etrade?
- Can I buy and sell Vanguard (Fidelity) funds (bond, stock, and target retirement funds) and ETFs through Etrade?
- What is the cost to invest in Vanguard (Fidelity) mutual funds and ETFs on Etrade account?

In this article we will provide answers to all these questions.


Funds on E*Trade


E*Trade has a good selection of both mutual funds and ETF's. A wide range of fund families is available, including both Fidelity and Vanguard. Even better, some of these funds carry no load and no transaction fee.

E*Trade's clients have access to over 9,000 mutual funds. More than 4,400 of these come with no load and no transaction fee. Several of these in turn have expense ratios below 0.30%; so the cost of owning mutual funds at E*Trade can be incredibly low. Case in point is BRLIX, a passively-managed fund that invests in blue chip stocks. Its expense ratio is just 0.15%. The fund currently yields over 2% and has 5 stars from Morningstar. Many other low-cost funds with good ratings can be found on the broker's website.

NTF funds at E*Trade that are held less than 3 months will incur a rather steep $49.99 short-term trade fee. Mutual funds that aren't transaction free cost $19.99. This charge is applied to purchases, exchanges, and sales.

Investors who are interested in ETF's can buy and sell all exchange-traded funds at E*Trade without paying a commission. Many of these commission-free products also have expense ratios below 1.00%.

Vanguard and Fidelity do appear on E*Trade's list of commission-free products. Here's a rundown on what's available.


Can You Buy Vanguard Funds on Etrade Account?


E*Trade customers have access to 70 Vanguard ETF's, all of which carry no load. Expense ratios on these funds vary from 8 basis points to 17 basis points. This range is one of the lowest in the industry. Vanguard's funds represent a variety of investment goals. For example, VDC is a consumer staples fund that invests in defensive stocks that have a history of good price stability. The fund makes distributions every 3 months and currently yields 2%. It has over $3 billion in assets, and has returned 14% annually over the past 5 years.


Can I Buy Vanguard Funds on Etrade


On the mutual fund side, the E*Trade screener shows 108 Vanguard products. All of these carry a transaction fee, but none of them have any loads. Although it does cost a rather uncomfortable $19.99 to trade these funds, the on-going management fee is very low in some cases, sometimes as cheap as 0.06%. One case in particular is VHDYX. This fund tracks an index of stocks that pay above-average dividends. It has 5 stars from Morningstar and yields around 3% right now. The fund's expense ratio is just 16 basis points, and its best year was in 2013 when it returned 30%.


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Can You Buy Fidelity Funds on Etrade Account?


E*Trade's ETF screener returns 21 Fidelity-branded products. These funds have no load, but do come with E*Trade's $0 commission. The expense ratios on these Fidelity ETF's are all below 0.50%, which is very good. Investors can choose a variety of investment purposes with Fidelity's exchange-traded funds. FENY, for instance, invests at least 80% of its assets in securities that are in the MSCI USA IMI Energy Index. Some of the companies in the index include Exxon Mobil, Chevron, and Anadarko Petroleum. The fund pays dividends quarterly and is currently yielding 2.5%.

The mutual fund screener on E*Trade's website displays 446 mutual funds from Fidelity. Almost 200 of these have a load, which can be as high as 5.75%. Fidelity funds with a back-end load charge no more than 1%, and as little as 0% in some cases. Six of the funds have no load and no transaction fee. One of these is FSITX, which invests at least 80% of its assets in securities that appear in the Barclays U.S. Aggregate Bond Index. This is a major index that tracks U.S. debt performance, so FSITX is a good option for investors who want to track it. The fund has an expense ratio of just 10 basis points and has a 10-year annualized return above 4%. FSITX pays distributions every month, which is great for investors who need income that frequently. Its current dividend yield is around 2%. This fund has a very large portfolio with assets over $26 billion. A lot of the holdings are in U.S. government debt, although 28% is invested in corporate bonds.


Can I Buy Fidelity Funds on Etrade


E*Trade Versus the Competition


Most mutual funds cost $19.99 at E*Trade. Firstrade and Ally Invest charge $0 and $9.99 for the same funds respectively.

Compared to many other brokers, E*Trade's mutual fund offering is good. For example, Merrill Edge offers only 4,000 mutual funds. TD Ameritrade, on the other hand, offers more than 13,000 funds, of which more than 4,400 carry no load and no transaction fee.

A few other brokers offer mutual fund trading by mobile app. For example, Schwab and Fidelity customers can trade mutual funds on those brokers' mobile platforms.


Buying Vanguard Funds on E*Trade Recap


E*Trade clients can find a good array of Fidelity and Vanguard mutual funds in all categories - index, bond, international and U.S. stock, and target retirement funds - as well as ETF's with minimal cost of ownership.


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