Here's a statement of the obvious: The opinions expressed here are those of the participants, not those of the Mutual Fund Observer. We cannot vouch for the accuracy or appropriateness of any of it, though we do encourage civility and good humor.
Just an FYI - In the trade ticket at TD, if you click on the Ask price, the trade ticket will automatically change from a sell order to a buy order. If you do not pay attention to this glitch, you will end up buying when you planned to sell. Similarly, if you click on the Bid price, the trade ticket will switch from buy order to a sell order. This issue is not there in the Schwab trade ticket. TD has stopped fixing bugs in their web trading and we need to pay attention for the next three days while trading at TD.
Completed the reinvestment of another Roth IRA conversion. I transferred shares of PRBLX from my Rollover IRA to my Roth a few weeks ago. A few days ago, I sold those shares and reinvested in TCAF and PRCFX, completing my approximation of PRWCX.
I manuvered in the direction of cash. Sold / submitted sell orders pretty much across the board. Should raise my cash level from around 10% to near 12%. Some of this due to caution - and some related to anticipated infrastructure spending.
Difficult to stay patient sitting on an unfilled Limit Buy Order when Mr. Market is rising and rising..... But it cannot go on forever upward in a straight line. Behavioral Economics. Beware of FOMO.
Difficult to stay patient sitting on an unfilled Limit Buy Order when Mr. Market is rising and rising..... But it cannot go on forever upward in a straight line. Behavioral Economics. Beware of FOMO.
All true enough, @Crash, but when things come down, there is no guarantee that it goes lower than it is right now either. FOMO is a real concern, but MO is as well! You pays your money and takes your chances. Best one can do is to play the odds.
Difficult to stay patient sitting on an unfilled Limit Buy Order when Mr. Market is rising and rising..... But it cannot go on forever upward in a straight line. Behavioral Economics. Beware of FOMO.
@Crash - You’re more patient than me. I fiddle for 5 or 10 minutes and than cancel the order. Don’t like uncertainty. One reason I’ve moved mostly to open end traditional funds is to get away from this minute by minute game.
I don’t know about “sell in May.” But ISTM that when a major index approaches a milestone (in this case Dow 40,000) that it will often move back & forth crossing that number several times in the ensuing months. Just a vague recollection.
Bloomberg reports that the DJI briefly crossed over 40,000 this morning before pulling back. You can say milestones don’t matter. Perhaps. But the public psyche is important (near term anyways) to markets and a milestone does mess around with psyche.
@racqueteer : "playing the odds" Sell in May & go away ?
Definitely not. First of all, I'm not sure this axiom is even valid. Secondly, algorithms are often based around market axioms. This has to be a situational decision. We've had all manner of bad news, and, despite everything, we've held up. We're coming off a downturn. I think there's at least a slight upward bias at this point. I think you can safely be a little bit bullish here. Not crazy, though.
So, I'm a tiny bit (5%) above my 'normal' equity allocation and have barbelled LCV with LCG momentum stuff. Paired that off with very safe USFR earning a solid 5+% day in and day out. If things change, I adjust around my core positioning. I'm not going to knock it out of the park, but I hope to also not lose a lot in a downturn.
Sold out of DBRG/I in pursuit of other income opportunities.
Sold out of FLNG ahead of earnings over concerns about dividend sustainability, coupled with the fact I couldn't DRIP it @ Schwab. They also recently recategorized part of their 2023 divs as ROC, which gave me pause. (It had a nice runup in recent weeks so I got out at breakeven.)
Currently stalking more utes to add on a pullback, along with adding to my midstreams and any preferreds that look good ... pending any suddent drops when everything goes on sale, I expect to be buying very incrementally thru at least the finale of November's circus.
Week-end is here. Still no execution on the Buy Limit Order. EPRT. I'm swimming against the current. Methinks I'll cancel the Order and take the cash I've held back to cover the trade, and just put it in SNVXX to earn over 5% for me, until there is a pullback. (Even 2-3 percent lower share price would suit me.) Otherwise, that cash is just dead money, sitting like a lump.
@Crash, you have to play the Schwab game. As long as you have that limit order open the system will make you keep cash in the sweep to cover it. BUT you can place a new limit order for a stock with no money in the sweep, crazy as it sounds.
What I normally would do in your situation is cancel the stock purchase order. Then move the sweep-cash to the MM. When that's done, reopen a new limit purchase order. You don't need cash in the sweep to do that, but if or when the order does go through you will need to replenish the sweep from the MM. I've found you have a day or 2 to do that.
It's a shame Schwab makes you play these games. It's the worst aspect about CS in my opinion.
Also, by the way, you are using a MM fund that pays considerably less than the Schwab MM fund, SWVXX.
Started a new position in QLTY. This will be one of my core funds. Also added to recent ARDBX initial purchase. ARDBX has a large opportunity set and the fund has an investment process similar to ARTKX. This small-cap foreign equity fund has a high expense ratio which is common for many Artisan funds.
SWVXX: Thanks, @MikeM. I recall your previous, there. I'm just choosing the security of the MMKT fund which is focused on Treasuries and the like. Good information for me in your post. Thank you.
@BaluBalu. I only have IRA accounts at Schwab, so yes.
BTW, in 10 days, stocks and ETPs settle T+1.
Yes, I remember that conversation. I'm assuming that means if I buy something, I have to put in a MM to sweep transfer by the next day... or the same day if I'm paying attention. Schwab has always sent me email warnings if I forget to transfer in the past. Should be interesting.
"[R]eopen a new limit purchase order. You don't need cash in the sweep to do that, but if or when the order does go through you will need to replenish the sweep from the MM" "I only have IRA accounts at Schwab."
More than one of my IRA account was transferred from TD to Schwab. In each one of those accounts I was not allowed to place a buy order without first selling MM to cover the potential buy. May be you can share (PM is Ok too), what Schwab account settings are allowing you to place a buy order before placing a MM sell order to cover for the potential buy. I am OK to let Schwab have cash before the settlement of the buy order but what is inconvenient is I always have to sell too much MM because by the time I place the sell MM order the Ask price on my buy order invariably increases.
I just trialed a purchase now to make sure I'm not crazy. I have $19 in one of my sweep accounts, in this case a Roth IRA but I've done it numerous times in my traditional. I placed a limit order to buy an existing stock I own. It went through fine. I tried it again to buy a stock I don't currently own, and it also went through fine. Both orders were for over a 1000 bucks. (I cancelled both orders after). I don't have any special settings.
@BaluBalu Can't you place the buy in $ amount instead of shares ?
I will look into this which might solve some problems. however, that does not change Schwab’s requirement that I place a sell MM first. I always try to buy in round lots so I have flexibility to sell calls and thus, buying fixed dollar amount is not a good choice for me.
The other inconvenience is I have to bid for the shares aggressively or use market orders because if they do not fill, I have to remember to cancel the MM sell order. Otherwise, cash sits in sweep over a long weekend earning nothing.
I dislike these frictions about Schwab, same friction at TD, which forced me to move money out of TD and converting most of MM into ultra low duration bond ETFs. These bond ETFs really do not solve the frictions entirely, except that the issues with non-marginable MM balance is not there. There is an additional cost with using ETFs as a substitute for MM funds - I lose a penny per share because of bid-ask spreads (retail clients are not allowed to place trades in fractions of a penny).
On Friday alone I lost $50 because by the time I calculated how much MM I needed to sell and place the sell order, my buy market order Ask price moved by 2 Pennies. At Fidelity I simply place my buy order. No need to sell MM and sweep earns almost as much as MM. At Fidelity I also happily leave a lot of cash in sweep if I think I am going to use it shortly and it does not matter if I forget to move to MM.
Most of those issues at Schwab do not apply if you are a mutual fund trader - the non marginable MM issue is there though. But for a stock trading account, it is very bad. Ironically, Swab are the ones that started the zero commission war on stock trades.
Now that I wrote down, that is a lot of BS and economic impact I have been putting up with at TD/ Swab. It was OK at TD because a lot of other things were good at TD and they didn’t have their own MM funds. Swab are praying on human inertia issues.
Any one else that has @MikeM privileges at Swab pl share how to get them.
@MikeM- when you purchase without enough in cash to cover are you certain that Schwab isn't tacking on margin debits? That's happened to me, I believe.
@MikeM - No warning, as I recall. I ran into that situation a couple of times when I had ordered a MMKT sale to cover a CD purchase, and got caught on the T+2 settlement date situation. I was charged only for the time between the CD purchase and the MMKT settlement. Not a lot of money, but still...
@Old_Joe, Mike said those are IRA accounts which I do not believe can attract margin debt. IRAs have limited margin capability to avoid good faith violations - to allow us to buy before sell orders settle.
@Old_Joe, I checked history, and I do not see any misc or extra fees, adjustments or any other type of charges on any of my buys. I checked trade details on buy transactions and no extra charges found.
@BaluBalu, I checked my account profile and it does not say I have limited margin access. It asks if I want to apply, which at this time I do not.
I've always believed the 'buy' money had to be in the cash sweep at time of the settlement date which has been 2 days after the buy, not the purchase date. I have been using this information in many transactions and by all appearances, it works.
Edit: found this in the CS question/answer section. It verifies what I thought.
How do I cover my trades? If your purchase exceeds the funds available in your account, in most cases, you can cover your trade by making a deposit of funds or marginable securities on or before trade settlement. If you choose to cover the amount due by selling a different security, the sale must occur on or before the purchase date to avoid a liquidation violation. Depositing marginable securities to cover funds due is only possible in a margin account, not a cash account.
Keep in mind that for most equity transactions, the settlement period is two business days from the day your order executes.
What is settlement and when does it occur? Settlement is when the buyer's and seller's accounts get the securities and cash, respectively.
For most stock trades, settlement occurs two business days after the day the order is executed. Another way to remember this is through the abbreviation T+2, or trade date plus two days.
For example, if you were to execute an order on Monday, it would typically settle on Wednesday. For some products, such as mutual funds, settlement occurs on a different timeline.
Relentlessly scouring the investible world for something. Bell Canada BCE is way-undervalued, per M* at -24% disc. HQ in Verdun-Montreal. Of course the geniuses at Schwab will not allow div. reinvestment. But the share price has dropped to the point where the yield is 8.5%. The analysis was actually thoughtful and intelligent. Limit order is in.
EDIT TO ADD: And now it's been FILLED. I'm taking the tiny bit left in "Cash" and moving it to my chosen Schwab Money Market acct., at about 5% interest.
Relentlessly scouring the investible world for something. Bell Canada BCE is way-undervalued, per M* at -24% disc. HQ in Verdun-Montreal. Of course the geniuses at Schwab will not allow div. reinvestment. But the share price has dropped to the point where the yield is 8.5%. The analysis was actually thoughtful and intelligent. Limit order is in.
I'm with you Crash ... following the April swoon (which I missed) there's not much 'on sale' at the moment or that I necessarily want to pay up for. At the moment I'm debating between moving cash into an ETF paying 5% or starting to DCA into positions I want to own in the coming weeks.
If the press would just continue to beat the drum on "AI" and "Rate cuts", equities can easily move up another 10% this year. The market is bogging down a bit here. Just a pause?
Seems all boats have been lifted. Like Blondie sang, the tide is high.
Getting 5% ain't so bad. Reaching for >10% is more fun....as long as the party lasts. Talk of rate cuts might carry us through 2024 in nice shape.
I keep adding small amounts to PHEFX, while mainly earning ~5% from cash (CDs).
Comments
Just an FYI - In the trade ticket at TD, if you click on the Ask price, the trade ticket will automatically change from a sell order to a buy order. If you do not pay attention to this glitch, you will end up buying when you planned to sell. Similarly, if you click on the Bid price, the trade ticket will switch from buy order to a sell order. This issue is not there in the Schwab trade ticket. TD has stopped fixing bugs in their web trading and we need to pay attention for the next three days while trading at TD.
I don’t know about “sell in May.” But ISTM that when a major index approaches a milestone (in this case Dow 40,000) that it will often move back & forth crossing that number several times in the ensuing months. Just a vague recollection.
Bloomberg reports that the DJI briefly crossed over 40,000 this morning before pulling back. You can say milestones don’t matter. Perhaps. But the public psyche is important (near term anyways) to markets and a milestone does mess around with psyche.
So, I'm a tiny bit (5%) above my 'normal' equity allocation and have barbelled LCV with LCG momentum stuff. Paired that off with very safe USFR earning a solid 5+% day in and day out. If things change, I adjust around my core positioning. I'm not going to knock it out of the park, but I hope to also not lose a lot in a downturn.
Sold out of FLNG ahead of earnings over concerns about dividend sustainability, coupled with the fact I couldn't DRIP it @ Schwab. They also recently recategorized part of their 2023 divs as ROC, which gave me pause. (It had a nice runup in recent weeks so I got out at breakeven.)
Currently stalking more utes to add on a pullback, along with adding to my midstreams and any preferreds that look good ... pending any suddent drops when everything goes on sale, I expect to be buying very incrementally thru at least the finale of November's circus.
What I normally would do in your situation is cancel the stock purchase order. Then move the sweep-cash to the MM. When that's done, reopen a new limit purchase order. You don't need cash in the sweep to do that, but if or when the order does go through you will need to replenish the sweep from the MM. I've found you have a day or 2 to do that.
It's a shame Schwab makes you play these games. It's the worst aspect about CS in my opinion.
Also, by the way, you are using a MM fund that pays considerably less than the Schwab MM fund, SWVXX.
This will be one of my core funds.
Also added to recent ARDBX initial purchase.
ARDBX has a large opportunity set and the fund has an investment process similar to ARTKX.
This small-cap foreign equity fund has a high expense ratio which is common for many Artisan funds.
BTW, in 10 days, stocks and ETPs settle T+1.
"[R]eopen a new limit purchase order. You don't need cash in the sweep to do that, but if or when the order does go through you will need to replenish the sweep from the MM" "I only have IRA accounts at Schwab."
More than one of my IRA account was transferred from TD to Schwab. In each one of those accounts I was not allowed to place a buy order without first selling MM to cover the potential buy. May be you can share (PM is Ok too), what Schwab account settings are allowing you to place a buy order before placing a MM sell order to cover for the potential buy. I am OK to let Schwab have cash before the settlement of the buy order but what is inconvenient is I always have to sell too much MM because by the time I place the sell MM order the Ask price on my buy order invariably increases.
I just trialed a purchase now to make sure I'm not crazy. I have $19 in one of my sweep accounts, in this case a Roth IRA but I've done it numerous times in my traditional. I placed a limit order to buy an existing stock I own. It went through fine. I tried it again to buy a stock I don't currently own, and it also went through fine. Both orders were for over a 1000 bucks. (I cancelled both orders after). I don't have any special settings.
The other inconvenience is I have to bid for the shares aggressively or use market orders because if they do not fill, I have to remember to cancel the MM sell order. Otherwise, cash sits in sweep over a long weekend earning nothing.
I dislike these frictions about Schwab, same friction at TD, which forced me to move money out of TD and converting most of MM into ultra low duration bond ETFs. These bond ETFs really do not solve the frictions entirely, except that the issues with non-marginable MM balance is not there. There is an additional cost with using ETFs as a substitute for MM funds - I lose a penny per share because of bid-ask spreads (retail clients are not allowed to place trades in fractions of a penny).
On Friday alone I lost $50 because by the time I calculated how much MM I needed to sell and place the sell order, my buy market order Ask price moved by 2 Pennies. At Fidelity I simply place my buy order. No need to sell MM and sweep earns almost as much as MM. At Fidelity I also happily leave a lot of cash in sweep if I think I am going to use it shortly and it does not matter if I forget to move to MM.
Most of those issues at Schwab do not apply if you are a mutual fund trader - the non marginable MM issue is there though. But for a stock trading account, it is very bad. Ironically, Swab are the ones that started the zero commission war on stock trades.
Now that I wrote down, that is a lot of BS and economic impact I have been putting up with at TD/ Swab. It was OK at TD because a lot of other things were good at TD and they didn’t have their own MM funds. Swab are praying on human inertia issues.
Any one else that has @MikeM privileges at Swab pl share how to get them.
@BaluBalu, I checked my account profile and it does not say I have limited margin access. It asks if I want to apply, which at this time I do not.
I've always believed the 'buy' money had to be in the cash sweep at time of the settlement date which has been 2 days after the buy, not the purchase date. I have been using this information in many transactions and by all appearances, it works.
Edit: found this in the CS question/answer section. It verifies what I thought.
EDIT TO ADD: And now it's been FILLED. I'm taking the tiny bit left in "Cash" and moving it to my chosen Schwab Money Market acct., at about 5% interest.
Seems all boats have been lifted. Like Blondie sang, the tide is high.
Getting 5% ain't so bad. Reaching for >10% is more fun....as long as the party lasts. Talk of rate cuts might carry us through 2024 in nice shape.
I keep adding small amounts to PHEFX, while mainly earning ~5% from cash (CDs).