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Author: nerdspeak Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 27660  
Subject: Schwab ETFs--is there a catch? Date: 11/29/2012 12:30 PM
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Since I want to add $100/month of exposure to the S&P 500 each month, SPY doesn't make sense--trading costs, even at $9/trade, will eat that up and more than make up for the difference in expense ratio between SPy and the Vanguard 500 index fund.



However, I saw that the Schwab U.S. Large-Cap ETF, which is Schwab's version of the SPY, has zero trading fees from a Schwab brokerage account. It's expense ratio is much lower than the Vanguard index fund, at 0.04%.



Is there some sort of catch with the Schwab ETF? If it does as good a job at tracking the market as the SPY or Vanguard, it seems like the perfect solution.
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Author: pauleckler Big funky green star, 20000 posts Top Favorite Fools Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 26277 of 27660
Subject: Re: Schwab ETFs--is there a catch? Date: 11/29/2012 1:16 PM
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Several discount brokers advertize no commissions on ETF trades. I don't know the details, but presumably its a loss leader program intended to attract your account, in hopes that you buy other services as your account grows.

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Author: trader2012 Big red star, 1000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 26278 of 27660
Subject: Re: Schwab ETFs--is there a catch? Date: 11/29/2012 2:53 PM
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Is there some sort of catch with the Schwab ETF? If it does as good a job at tracking the market as the SPY or Vanguard, it seems like the perfect solution.

The 'catch' --if you want call it that-- is that if you sell shares sooner than the mandatory holding-period --which will vary from broker to broker among those who offer commish-free ETFs -- you will have have to pay the commish that would have otherwise been charged to you.

Scottrade, AmeriTrade, Fidelity, and Schwab all offer a selection of commish-free ETFs, and maybe other brokers as well. So shop around.

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Author: wrjohnston91283 Big red star, 1000 posts Old School Fool CAPS All Star Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 26279 of 27660
Subject: Re: Schwab ETFs--is there a catch? Date: 12/2/2012 7:18 PM
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Here's a chart showing the performance of the fund you are looking at (I think, SCHX), versus the SPY ETF, as well as the S&P 500 itself. Looks pretty close.

http://finance.yahoo.com/echarts?s=SPY#symbol=spy;range=2y;c...

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