Archives for August 2016

Amazon Problems: Counterfeit Products

azbirky0In my previous installment of Amazon Problems, I talked about fake Amazon product reviews. This time, I talk about fake products themselves. Thanks to lax Amazon policies, buyers now have to worry about whether their products are genuine or counterfeits.

Amazon is now more of an open marketplace and less a “store” like Best Buy or Wal-Mart. Nearly 40% of Amazon’s total sales now come from two million third-party sellers. When you buy something, the website might still look like Amazon but the behind-the-scenes process could be very different. You basically have one of three options:

  • Ships from and sold by Amazon.com. The real “Amazon store”. Amazon buys the products wholesale directly from the manufacturer, keeps them in Amazon warehouses, and then Amazon ships it you.
  • Fulfilled by Amazon (FBA). This means a third-party bought the product from somewhere, claims that it is authentic, and then ships it over into an Amazon warehouse. You buy it, and Amazon ships it. This allows the merchant to make their products eligible for Free Super Saver Shipping and Amazon Prime.
  • Ships and sold by Third-Party. The sellers have to follow certain rules, but you are mostly dealing directly with a third-party seller with their own warehouse and order fulfillment. This is like eBay or traditional flea markets.

Because Amazon essentially allows anyone to ship them something and say “These are the real thing!”, that opportunity itself can encourage counterfeiting. In July 2016, Birkenstock announced that due to counterfeits and Amazon’s lack of response, they will no longer supply products to Amazon as of January 1st, 2017. In addition, they will no longer authorize third-party merchants to sell on the site.

According to another CNBC article, other brands with questionable authenticity include Michael Kors and Canada Goose. Amazon even commingles inventory from various third-party sellers, so you end up with no idea where your product really came from:

To unsuspecting consumers, fake products can appear legitimate because of the Fulfillment by Amazon program, which lets manufacturers send their goods to Amazon’s fulfillment centers and hand over a bigger commission, gaining the stamp of approval that comes with an FBA tag.

Furthermore, Amazon’s commingled inventory option bundles together products from different sellers, meaning that a counterfeit jacket could be sent to an Amazon facility by one merchant and actually sold by another.

I can only hope that Amazon’s own inventory is still kept separate from the Fulfilled By Amazon (FBA) inventory.

Per The Counterfeit Report, here are some other brand name items with reports of counterfeit copies online:

  • Converse Chuck Taylor All Star shoes
  • The North Face Denali jackets
  • Gillette Fusion Razor Blades
  • Giorgio Armani: Acqua Di Gio fragrance
  • Bose headphones
  • Otterbox smartphone cases
  • Duracell batteries

It’s really hard to tell between fake and real products. Last year, a detailed teardown of a $199 Beats headphone that revealed only $17 of cheap parts went viral. That pair of headphones turned out to be fake. But wait, they did a another teardown of authentic Beats headphones and found them to be still very similar, with $20 of cheap parts. It really says something these hardware experts didn’t even recognize a fake after tearing it apart (the boxes and internal materials are also excellent copies).

This counterfeit problem should be a huge concern for Amazon. Every time I look at a brand name product like Bose headphones, Nespresso coffee pods, or Ray Ban sunglasses, I have to pause and weigh the chances that I’ll get a fake product. Is the price too good to be true? Why is this other price so much lower? If another big merchant comes along with a good user interface and reliable product sourcing, then I would definitely consider shopping there instead. (You hear that, Jet.com + Wal-Mart?)

What can you do? One option is to only buy things marked “Ships from and sold by Amazon.com.” This may mean you have to voluntarily pay more for the same product – so painful! – but it may be worth a few extra bucks for the peace of mind. I would also consider third-party sellers if they are the original manufacturers of the product. For example, you could buy ExOfficio boxer briefs directly from the ExOfficio seller account (although sold by Amazon is cheaper right now).

Amazon’s return policies could still be considered “customer-friendly”, but only if you are an alert and active customer. It is your responsibility to examine your product for any inconsistencies. If you spend the time to contact them and complain, by most accounts Amazon will refund your money if under FBA, or at least pressure the 3rd-party merchant to refund your money. This isn’t good enough; I hope that Amazon becomes less reactionary and be more pro-active about this problem.

Free 25 Hertz Gold Plus Points

hertzgp0Hertz has a Summer Bonus promotion with bonus points on your summer car rentals through 9/5/2016. Not much time left, but you can still get 25 free Hertz points just for registering with your Hertz Gold membership number.

Register to earn up to two Free Weekend Days on your summer rentals with Hertz Gold Plus Rewards® from August 9, 2016 through September 5, 2016. You can earn:

275 bonus points on your first qualifying rental
275 points on your second
550 points on your third
That’s 1,100 Gold Plus Rewards points—enough for two Free Weekend Days!

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These points won’t extend your expiration date (you need rental activity every 24 months), but they may get you closer to that next free rental (starts at 550 points for a free weekend day).

Schwab Target Date Index Funds Review

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Charles Schwab has announced Schwab Target Index Funds, a new series of “all-in-one” target date mutual funds that are made up entirely of in-house Schwab Index ETFs and a Schwab cash mutual fund. Their existing offering Schwab Target Funds differs in being significantly more expensive and including a mix of passive and actively-managed funds. Each fund will have a target date between 2010 and 2060, spaced in 5-year increments. Let’s take a closer look.

What’s inside? The portfolio for any given target year is composed of 9 different asset classes. Here is a graphical illustration of their “glide path”, or how the asset allocation changes relative to the target retirement date. (Source. Click image to enlarge.)

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Here’s a 2016 snapshot of what every fund is holding by target date (Source. Click image to enlarge.):

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Overall, the glide path conforms to industry norms, with high equity at younger ages and lower equity as you reach and pass retirement. Here are the ETFs and mutual funds that represent each asset class.

  • US Large Cap Equity – Schwab U.S. Large-Cap ETF (SCHX)
  • US Small Cap Equity – Schwab U.S. Small-Cap ETF (SCHA)
  • International Developed Equity – Schwab International Equity ETF (SCHF)
  • Emerging Markets Equity – Schwab Emerging Markets Equity ETF (SCHE)
  • Real Estate – Schwab U.S. REIT ETF (SCHH)
  • Short-Term Bond – Schwab Short-Term U.S. Treasury ETF (SCHO)
  • Intermediate-Term Bond – Schwab U.S. Aggregate Bond ETF (SCHZ)
  • Inflation-Protected Bond – Schwab U.S. TIPS ETF (SCHP)
  • Cash – Schwab Variable Share Price Money Fund — Ultra Shares (SVUXX)

How much do they cost? What are the investment minimums?

  • Individuals can buy Investor Shares with an expense ratio of 0.13%. The minimum initial investment is $100.
  • Employer-sponsored retirement plans can access the Institutional Shares with an expense ratio of 0.08%. There is no minimum initial investment.

An interesting thing to note is that the mutual funds technically have an extra layer of management fees and “other fees” on top of the expenses from the underlying ETFs and mutual funds. However, Schwab has agreed to cap the expenses at 0.13% for Investor Shares and 0.08% for Institutional Shares. This is supposed to stay in place “for so long as the investment adviser serves as the adviser to the fund”… they might want to re-word that.

In any case, even with the cap, the Investor Shares still cost more than the expenses from the underlying investments. You are basically paying 0.05% to 0.08% for some simple asset allocation. That means you could build your own portfolio using the same Schwab ETFs at a lower cost. You could also get rid of the (unnecessary in my opinion) cash component, which currently only yields 0.43% with another temporary fee waiver as of 8/26/2016. Personally, that’s what I would rather do, but I will admit that some folks will do better with an automated asset allocation.

How does it compare with Vanguard Target Retirement Funds? This is the natural comparison, as Vanguard’s target funds have the most assets and they used to be the cheapest before Schwab came along. Across the series, the expense ratio for their retail fund varies between 0.14% and 0.16%. You can now see why Schwab has priced their funds just below that at the “sale price” of 0.13%. Schwab loves to be cheaper by a basis point or two.

In terms of asset allocation and glide path, here are some side-by-side comparisons:

  • Vanguard has a equity split of 60% domestic and 40% international. Schwab has a equity split of 67% domestic and 33% international (if you consider the 4% US REITs as US stock).
  • Vanguard starts at 90% equity max and reaches 50% equity at retirement age. Schwab starts at 95% equity max and reaches 40% equity at retirement age.
  • Asset classes that Schwab includes specifically, which Vanguard does not: REITs, inflation-protected bonds (TIPS), and cash.
  • Asset classes that Vanguard includes specifically, which Schwab does not: International bonds.

Commentary. Schwab is definitely serious about index funds. They’ve built their own set of low-cost index mutual funds and index ETFs to compete with Vanguard and iShares. They already have an automated portfolio “robo-advisor” called Intelligent Portfolios, which uses these index funds as well as some “smart beta” funds. They’ve added these Target Index funds to grab the 401(k) and individual markets including IRAs. Put another way, they sell flour and butter, and they also sell pre-made pies and cakes.

This is a long-term play for Schwab, as they’ve all but admitted that the index ETFs themselves are currently losing money, while hoping to either make up the difference in other fees, services, or products somewhere down the line (like when interest rates rise again). Schwab will surely grab much more assets from employer retirement plans as a result of this move. In my limited experience with them, I have found Schwab to have solid customer service, at times in fact better than Vanguard. If they can leverage their customer service and human component, I think this is a smart move on their part.

However, if given the choice, I’d recommend my family to buy Vanguard Target Retirement funds first because Vanguard is not a for-profit company and I trust Vanguard more to keep customer interests first over the long run. (I believe that Schwab includes cash where it isn’t necessary in order to increase their future fees from money market funds, which are an important contributor to profits. This isn’t as significant here as in their robo-advisor product, but it will matter more as interest rates rise. More importantly, Vanguard doesn’t play such games.) However, big-picture-wise they are very similar. I’d gladly recommend that they buy a Schwab Target Index fund in their 401(k) or 403(b) plan as they are likely the best options if available. This is a positive development overall for individual investors.

US National Park Centennial: Free Admission, Special Events, and Virtual Reality Tours

The National Park Service turned 100 on August 25, 2016. From Thursday 8/25 to Sunday 8/28/16, there will be special events and free admission to all 412 national parks. Visit FindYourPark.com to find details about your nearest park.

The fee waiver includes entrance fees, commercial tour fees, and transportation entrance fees. Other fees such as reservation, camping, tours, concession and fees collected by third parties are not included unless stated otherwise.

If you can’t visit the parks in person (if even if you can), check out “The Hidden Worlds of the National Parks”. You’ll see select parks in 360-degree virtual reality thanks to a partnership between the NPS and Google. You can use Google Cardboard for the full experience, but it still very cool on a big screen with headphones. Here’s a one-minute preview video:

Finally, NASA is sharing what the US National Parks look like from the Space Station.

Finally, you may have noticed the Google Doodle of the day, which linked to a neat one-minute animated video below:

Free Educational Apps for Children: Duck Duck Moose

ddm0bIf you’re a parent of young children these days, you’re likely looking to make their screen time active and educational instead of passive. Unfortunately, free apps are often of low quality or severely restricted. Meanwhile, there are some excellent paid apps, but the cost starts adding up quickly at $2 to $10 a pop.

So it was welcome news when non-profit Khan Academy announced that they are partnering with developer Duck Duck Moose and making all of their apps completely free to download with all features. They have won 21 Parent’s Choice awards and 18 Editor’s Choice awards from Children’s Technology Review.

Here are links to all of their Android apps and all of their iPhone / iPad apps. More supposedly are in the works.

There are a lot to choose from, so here are the apps organized by awards won. Here are the Common Sense Media reviews of certain apps.

SolarCity Bonds: 6.50% Interest for 18 Month Term

scty0bSome folks don’t like it when I write about investments that aren’t low-cost index funds. The thing is, when I find something intriguing, I like to dig deeper and then keep a record my findings. That way I can look back later and see how things turned out and compare with my opinions at the time. Just because I write about something doesn’t mean I recommend it, you have to read the entire post.

SolarCity is a company that installs and finances solar panels on commercial and residential properties. Back in October 2014, they started to allow individual investors to buy senior, unsecured corporate bonds directly from them online. You could invest as little as $1,000 in these SolarCity SolarBonds and pay no trade commissions or fees. The critical feature is that these “solar bonds” were backed only by the claims-paying abilities of the issuing company. If SolarCity fails, then you could lose your entire principal as well as any interest owed.

In general, the more confident you are that you’ll be paid back, the lower the interest rate the borrower has to pay. Other factors will come into play, such as the overall interest rate environment. With this in mind, check out the history of these bonds:

  • In 2014, SolarCity was issuing 7-year bonds paying a 4% annual interest rate.
  • In mid-2015, SolarCity was issuing 5-year bonds paying a 5% annual interest rate.
  • Currently in August 2016, SolarCity is offering a 18-month bond paying 6.5% annual interest rate. Ends August 30, 2016.

scty2

Supposedly, SolarCity is passing on the savings of doing things in-house and not having to pay investment banker fees. I still declined to write about these SolarCity bonds in the past because the yield and term lengths were not good enough to grab my interest. But 6.5% in 18 months? Okay, you’ve at least gotten my attention.

Consider that as of 8/24/16, an 18-month Treasury bill yields approximately 0.70%. The highest 18-month FDIC-insured CD pays roughly 1.35%. Investment-grade (A) corporate bonds are averaging ~1.15% for a 2 year maturity. Even a junk bond ETF like JNK may have a 6.5% yield but an average maturity of over 6 years.

What’s happening? Well, SolarCity is struggling in several areas. It’s been losing money reliably, every year. Here’s the stock price chart:

scty1

Perhaps more importantly, it has some big bills that are coming due soon. According to this TheStreet article, SolarCity has $3.25 billion in debt, with $1.23 billion due by the end of 2017. Note that date. At the same time, Tesla has offered to buy SolarCity in an all-stock deal.

Obviously Elon Musk and his SolarCity co-founder cousins want it to happen, as it has been widely-reported that they bought a big chunk of these bonds on their own. See Fortune, WSJ, and MarketWatch.

Why would they buy these bonds? My wild-guess opinion is that it looks like SolarCity is trying to extend its debt long enough so that Tesla can safely buy the company and then refinance things on better terms. I would say that if the deal closes, then these 6.5% bonds will pay off. I believe that Tesla will still be around in 18 months. However, if the deal doesn’t close for some reason, then SolarCity might be in big trouble.

Are these 6.5% bonds worth the risk? Given that Elon Musk and his cousins are a big shareholder in both companies and just bought $100 million of these bonds, that would seem to place your interest in line with theirs at this point. I’d actually rather hold these bonds for 18 months than be a shareholder for 18 months. However, you are still faced with the chance that the deal will hit some unforeseen obstacle, so it all depends on your confidence level. For me, the reward just isn’t high enough to justify the risk of permanent principal loss (I’d rather have a house as collateral), so I am going to pass and wait to see how it turns out.

MogulREIT: CrowdFunded Real Estate for Non-Accredited Investors

rmlogo200While the number of real estate crowdfunding sites keeps growing, most marketplaces still require you to be an accredited investor with high income and/or net worth requirements. However, options for non-accredited investors should improve shortly due to the expanded Regulation A+ per the JOBS Act, which allows the general public to invest in private companies under certain circumstances.

RealtyMogul.com just announced their offering called the MogulREIT I. Instead of being able to buy part of a specific shopping center or providing a loan against a specific apartment complex, these REITs take your money and the sponsors get to pick out a diversified pool of commercial estate. The investor has much less control, but easier diversification. Instead of putting $2,500 into one building, you can spread $2,500 across 20 or 30 properties. Here are more details from their website:

  • Fund intends to be diversified across property types, investment types, and geographies.
  • The Fund expects to pay quarterly distributions starting the second full quarter of operation.
  • The Fund will provide certain redemption opportunities, quarterly.
  • MogulREIT I is audited by Cohn Reznick and administered by Opus Fund Services.
  • $2,500 Minimum Investment.

Here’s what they have to say regarding expenses:

Investors in MogulREIT I will not be charged any sales commissions and the organization and offering expenses are anticipated to be approximately 3% of the target total raise of amount. Traditional non-traded REITs typically charge an average sales commission of 7% and organization and offering expenses of up to 15%**.

There are more details in the full SEC offering circular. Please do your own due diligence.

As I’ve said before, I would tell my family to invest in a low-cost, diversified, publicly-traded REIT fund before investing in any of these non-traded REITs with limited liquidity. For example, buying shares of the Vanguard REIT Index ETF (VNQ) will give you commercial real estate exposure with rock-bottom expenses and daily liquidity. VNQ and its mutual fund equivalents are where the vast majority of my commercial real estate exposure remains.

That said, I find this area of investing to be interesting. I like the idea of focused real estate but don’t enjoy being a landlord. I have invested $2,000 of “experimental money” into the similar Fundrise Income eREIT, as I prefer high-interest loans backed by real estate as collateral. Fundrise also has a Growth REIT which focuses more on real estate equity. The MogulREIT I is supposed to target both income and growth. I currently have no plans to invest in either the Fundrise Growth REIT or the MogulREIT.

Using Your 401(k) and Roth IRA as Emergency Funds

savebuttonbankWe’ve all heard that you should keep an emergency fund in case of unexpected expenses or unemployment. But what if you don’t have the cash? Personal finance author Jonathan Clements presents a mathematical argument for using your 401(k) as an emergency fund in his recent article The Terrible Twenties. Here’s how the math works.

Let’s say you are in the 15% federal income tax bracket and you put $2,000 in your employer’s 401(k) plan. Your out-of-pocket cost would be $1,700, thanks to the initial tax savings. At the same time, your employer matches your contributions at 50 cents on the dollar, with the matching contribution vested immediately. Result: Your $2,000 investment gets you a $1,000 match, bringing your account balance to $3,000.

If you are then laid off and forced to liquidate your retirement account to pay living expenses, you might lose 15% to federal income taxes, plus another 10% to the tax penalty for making a retirement account withdrawal before age 59½. That combined 25% hit would still leave you with $2,250, well above your $1,700 out-of-pocket cost.

To be fair, this isn’t nearly as radical as it seems. Most prioritized lists of “where I should put $XXX?” will put a 401(k) up to the company match as the #1 priority, even above a cash emergency fund.. A company match gives you a way to earn a 50% or 100% instant, risk-free return on your money. This is a rare opportunity that you shouldn’t pass up.

However, not mentioned is that after you exhaust any 401(k) match, you could also consider contributing to a Roth IRA and using that as your emergency fund. The primary reason for this is that Roth IRA contributions can be taken out at any time, without penalty. Unlike Traditional IRAs, withdrawals from Roth IRAs are subject to ordering rules (see Chapter 2 of IRS Pub 590-B), which state that you always withdraw your own contributions first.

In either case, since you can only contribute a certain amount to 401(k) and/or IRAs every year, it would be wise to take advantage of this tax-sheltered space as much as possible. Don’t make a withdrawal if you can avoid it, but if you have limited options, it can make sense to contribute first and hope you can keep the money invested for retirement.

Two Ways to Get Rich: Save Like Crazy, or Start a Business

Cash ImageTom Corley performed a study examining 233 self-made millionaires over 5 years, and found that they fell into one of two categories as outlined in this Business Insider article:

  1. They were fanatical savers.
  2. They sold something.

This aligns with my own observations as someone who has thought about financial independence nearly every day for over the last 10 years. My version:

  1. You can become financially independent by managing your income and expenses carefully over a long time. If you start at zero, you will need a 50% savings rate to retire in 15-20 years. You will need a 30% savings rate to retire within 25-30 years. Thus a household making $100k has to live on $50k (both after taxes). Being a steady, salaried or hourly-rate employee will do just fine. There is no secret besides applying discipline and consistency.
  2. You can become financially independent faster by starting a scalable business. By starting a scalable business, you are breaking the link between hours worked and money earned. As a salaried or hourly worker, you’ll never earn more than a set amount, be it $40k a year, $400k a year, or $20 an hour. As a business owner, your income has no ceiling. You take the risks, and you get all the rewards. Ideally, this results in a lump-sum “liquidity event” like a sale or IPO that provides the same amount of money as decades of steady savings. (Controlling your expenses still matters, even millionaires can go broke when the income stops flowing.)

The first option can be described as “get rich slowly” or “get rich surely”; it is more reliable but may take longer (or at least feel longer). The second option is “get rich quickly” but also “get rich maybe”; there is more risk and results are not guaranteed despite the size of your efforts. Luck will have a role, but if you don’t even try then your chances are zero.

If I was to make a broad recommendation (i.e. what I plan to tell my kids), I’d say that if you really wanted to get rich, you should (1) do both options above and (2) do it now, hopefully when you are younger and don’t have as many responsibilities. Keep your expenses bare-bones and start a business. Being a single 24-year-old meant I could still have fun with minimal expenses and spending 60-80 hours a week working on a project didn’t destroy my family or personal life.

Store-Bought Rotisserie Chicken: An Economic Analysis

costco_chickenCostco’s $4.99 rotisserie chicken is about as famous as their $1.50 hot dog and soda combo. It’s cheap, but is it a good value? Priceonomics went out and did an real-world experiment using store-bought rotisserie chicken. You may have noticed that the rotisserie chickens are often smaller than the raw whole chickens you can buy in the same store.

To test out whether rotisserie chickens are still a bargain after you account for their size and reduced water weight, we ran an experiment. We visited seven supermarkets and bought a rotisserie chicken and a raw chicken from each. After draining each rotisserie chicken of the fluid that collects in the container, we weighed them. Then we cooked the raw chickens […] and weighed them.

Here are the results from Priceonomics:

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At Costco and Smart & Final, the rotisserie chickens are actually cheaper than cooking it yourself. At other grocery chains, on a per pound basis you can save money cooking it yourself. You can save even more by stocking up when there is a sale. Whole chickens go for $0.99 or less per pound pretty regularly in my experience.

This analysis tried to focus on the numbers, but there are other factors to consider. Time is a big one – If you don’t like to spend your time cooking, you may prefer the rotisserie. Control is another – if you prefer to buy organic, avoid any “enhanced” flavorings and additives, or otherwise customize your chicken, you may still prefer to cooking yourself.

OpenSignal LTE Network Comparison: T-Mobile vs. Verizon

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OpenSignal (mentioned previously) crowdsources cellular coverage and speed maps directly from individual network users. They recently released the August 2016 update to their State of Mobile Networks USA Report, which was based on 2.8 billion measurements collected by 120,000 OpenSignal users. The results may surprise you.

Verizon is still first, but T-Mobile is now a close second in terms of LTE Network availability. Note the definition of availability is based on the percentage of time that users get a LTE signal; it is not directly based on geographical coverage.

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T-Mobile is now first (again, the difference is small) in average LTE network speed.

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Coverage is still location specific. At the bottom of the report, they list which networks have the best coverage in your metro area. For example, Verizon is tops availability for Boston and New York City, Verizon and T-Mobile are tied for top in Los Angeles and Seattle, and AT&T and Verizon are tied for tops in the San Francisco Bay Area.

Using their crowdsourced maps, you can even drill down to your home, school, workplace, or commute route. It’s free to see their coverage maps online, but you should consider downloading their free smartphone apps (Android / iOS) so that you can also contribute anonymous information and improve the data quality for everyone. The app will even direct you if you want to walk towards a better signal.

Bottom line. LTE is now the most important form of cellular data. T-Mobile has invested a lot of money into 4G LTE coverage, while Sprint has less complete and slower 4G LTE coverage. While Verizon still has the best geographical coverage, depending on your location the T-Mobile network may offer equally good LTE coverage and speed. This is good to know since T-Mobile is always offering some sort of promotion, while the MVNOs that use their network like Ting and Republic Wireless are the cheapest options.

The Vanguard Effect on ETF and Mutual Fund Expenses

vanguard_logoThe following chart taken from this Bloomberg article by Eric Balchunas shows the drastic difference in expense ratios when Vanguard has an offering in an asset class or not.

Like Walmart arriving in a new town, the entry of Vanguard into a particular investment area causes a collective gnashing of teeth as other fund managers are forced to drop their prices to compete. That dynamic is borne out in the table below, which shows the cheapest ETF fees for products that do or do not have a Vanguard-provided equivalent.

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This is the “Vanguard Effect”. Here’s my version of explaining how it works:

  • When Vanguard competes in an area, the expense ratios across the board are much, much lower.
  • Note that the cheapest expense ratios you see in those asset classes not necessarily from Vanguard itself. It is often from a competitor like Charles Schwab.
  • When Vanguard doesn’t compete, the expense ratios are much higher.
  • In those no-Vanguard asset classes, the competitor won’t lower prices just because they can. They’ll keep the profit margin as high as they can, as they are bound to serving the business owners as well as ETF share owners. The gap between what they can charge and what they must charge goes to business profits. They aren’t evil, they are just trying to serve their two masters.
  • At Vanguard, the business owner is the ETF share owner. (Vanguard uses the term “client-owned”.) For them, the most efficient way to pass on potential profits is to keep expenses as low as possible.

This is why you see DIY investors always wish Vanguard would offer something like an International Small Value ETF or a US Micro Cap ETF. By simply entering the ring, even the expense ratios of the ETFs we already hold from other providers will go down.