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Author: MuadDib Big red star, 1000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 27818  
Subject: DRIP into S&P 500 Date: 7/23/1997 10:07 PM
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Howdy every fool!
Thought that I'd add my opinion to the great DRIP folder of Motley Fooldom.

If every person that posts to this board writes/e-mails every S&P company to set up a DRIP with a direct purchase plan (if they don't have one) and each company in the S&P 500 complies with our FOOLISH request, we could in effect start the TMF S&P 500 DRIP and kick the @$$ out of Vanguard! There is no way that Vanguard could keep expenses below $.10 per check and $.32 per stamp required to make monthly (or whatever time frame) investments. If you assume that most people with mutual funds contribute with checks, then the cost of sending in DRIPS would be $.32 per company=$160.
If you invest directly, the fees could be less. Either way, I bet we could beat the Vanguard S&P 500 Index Fund on expenses. If we truly got foolish and used valuation (as suggested by some of the TMF personnel, and used Dividend Yield and P/E) we could concentrate our investments into a smaller number of stocks of the S&P, use risk-management to lower risk/receive higher return, decrease our expenses, beat the Vanguard S&P 500 Index Fund on expenses and returns (and beat 83% of all mutual funds in the process). This sounds incrediblely Foolish to me.

Thoughts&Comments?
Muad'Dib

P.S. Please Fool Over to the Cash-King Boards--great posts about large companies with great DRIPS.
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