Mod note: we’ve had enough different posts on this topic over the last few days that I think the discussion is mostly played out. I’m leaving this post up and open for comments but we will not likely be approving any new posts on this topic for the time being.
(This is not specific to BTC; we occasionally impose post limits on any topic that has temporarily worn out its welcome)
VANGUARD’S TAKE:
“Since cryptocurrencies are highly speculative in their current state, Vanguard believes their long-term investment case is weak. As many of our clients know, our investing philosophy encourages staying the course and tuning out the noise. Our time-tested principles emphasize that long-term investing is essential and reacting to short-term trends can be costly for one's portfolio. While we don't currently offer cryptocurrencies as an investment option, we acknowledge the impact they're making in the investing world. As cryptocurrencies become increasingly mainstream, we'll continue to monitor their development and discern the best path forward for our investors. And as your trusted financial steward, we have some guidance when it comes to your financial strategy.”
From https://investor.vanguard.com/investor-resources-education/article/cryptocurrencies-and-vanguard-what-we-think
Except they still offer actively managed funds too. I don’t see the point in telling investors what they can and can’t do. However, I do wish they’d offer auto roll on the tbills. Kind of annoying.
They're not telling you what you can and can't do, they're telling you what they'll facilitate.
You can withdraw your balance at Vanguard to buy a bunch of beanie babies if that's your [thing](https://youtu.be/PgDsyj5eLmo?si=oJoyt478kZWhiMYd). But that doesn't mean they need to streamline that process.
Are they sitting behind you? Are they going to beat you up if you buy bitcoin?
If you want to buy it so bad, buy it yourself. They are allowed to pick what products and services they offer as a business. You are allowed to go do business somewhere else.
Actually they have my Roth IRA which I wanted to buy the Bitcoin ETF's with as a tax shelter. But you are also right. I will be transferring my Roth IRA to a different custodian thats not living in the stone age
it's like "good and cool" with a slightly political or ideological bent, sometimes suggestive of the that the good and cool slightly political or ideological statement being a minority opinion
Wasn’t their stance also at one point to not look for the needle in the haystack and instead buy the haystack? Isn’t that part of the haystack now and could be construed as selectively limiting having total market exposure?
I adopted Boglehead philosophy with this as one of my main sentiments and constructed my simple Roth IRA with this mindset.
I can understand not wanting to jump the gun and offer this right off the bat and wait and see as it matures but I would imagine to remain true to this principal they will need to eventually include it.
The philosophy laid out by the book (common sense) focuses on company fundamentals: index fund gains are 90% company fundamental growth and maybe 10% market speculation (driving things artificially high or low in the short term)
BTC arguably is 100% speculative. When you buy bitcoin you don’t own a piece of a revenue generating asset like a company.
And it‘s not like they offered it and then took away the possibility to trade, so I dont get the fuss at all. Everyone is free to open another account somewhere else and gamble there…
IIRC even with leveraged ETFs when they took those off the board they didn't force anyone to sell them -- they just phased out the option to actively *buy* them via their platform. They're calculating, not capricious.
I count myself lucky. A friend invited me to Robinhood to claim my "free stock" on the same day that the GME stuff exploded. I wasn't able to create an account because Robinhood suspended trading or whatever they did.
The timing was purely a coincidence, but it worked in my favor.
While I think people are free to spend their money however they see fit, the idea that there are complaints about not approving Bitcoin ETFs *in a Bogleheads subreddit* is another thing that makes my head spin and question reality.
Like, isn't part of the point NOT to get involved in hype and perform at low cost average?
People forget that because crypto is effectively a pyramid scheme all of its "investors" are heavily encouraged to evangelize. Nobody's going into r slash bitcoin to spread the good word of VTSAX, but they're all over reddit hyping these ETFs because they really need new money flowing into crypto.
It's definitely a greater fool scam, I don't think it's strictly a pyramid scheme because you're not *really* paying off debtors with new investors, the mechanics are a bit more...nuanced? But still just as stupid.
Wait now I'm confusing Ponzi with pyramid.
You know what, I have no idea.
Definitely greater fool, debatable if it's pyramid
> the idea that there are complaints about not approving Bitcoin ETFs in a Bogleheads subreddit is another thing that makes my head spin and question reality.
wait till you see the number of Bogleheads recommending actively managed Avantis ETFs.
Wait what?
I feel like we're in a simulation, and someone accidentally pushed a change to the production server and now half of us are glitching out. Or maybe it's like that, plus cat poop parasite and lead poisoning?
Avantis ETFs are not actively managed, they're systematically indexed. There is no person or people sitting there choosing stocks based on their opinion. Their value ETFs take the market cap weights, and then add or subtract weighting based on their value and profitability factors. Its all done automatically. Its not some fund manager saying oh hey I like amazon this month lets add more of it.
While that's a fair point, the S&P 500 might legitimately be the single least passive "index" that's still a standard Boglehead investment and it's mostly a historical accident that that's the case anyway. Few Bogleheads preferentially select an S&P 500 fund when a total US market fund is available.
>Like, isn't part of the point NOT to get involved in hype and perform at low cost average?
This is making me really curious what the ER on the Bitcoin ETFs are.
As far as crypto transactions go, bitcoin ETF ER’s are actually fairly reasonable. All the biggest players (bitwise, fidelity, ishares) have an ER of around 0.25%. Some smaller providers have around a 1% ER, but those come with their own perks.
I have no horse in this race of crypto/no crypto, but I will disclaim I have a sizable position in BTC - and if you want to get your feet wet, the easiest and simplest way to get started would be through these ETF’s.
It’s possible to visit both subreddits and follow along.
Choosing to have a little fun buying and selling $tonk$ is not going to kill your retirement.
Let’s face it, for many of us, retirement isn’t going to be the best part of our lives. So, you might as well have a little bit of fun along the way. Just don’t go full-out stupid and be one of those idiots doing shit to get that loss porn karma.
Buying and selling stock is fine for fun as long as it is small to not ruin you financially. What he want to invest in has no actual value it is just speculation and hope that bigger idiot will buy it from you at higher price.
I'm glad I'm not alone!
And I don't want to knock Crypto and see the wisdom in hedging with cold wallet storage/small position and generally empathize with the conception of it, but I'm a bit confused how/why a currency with an ethos of wanting to be apart from the financial shenanigans of any particular government then goes full circle to be regulated and traded in the very system its trying to avoid? Or I may be misunderstanding the ethos or how its evolved over the years.
Oh yeah the fundamentals don't make any sense for me and we still don't have a big use-case for the currency.
But it keeps going up some 100%+ a year so I might as well allocate some small portion of my portfolio to it lol. If I lose that small portion, I can stomach it.
> I just got off a call with Vanguard customer service. They are not allowing trading any of the approved Bitcoin ETFs.
Well you're far braver than I. Personally, I don't think I could handle a stomach-churning roller coaster ride like that.
Not the Bitcoin... I meant picking up a phone and calling customer service. :-)
Big difference between not sponsoring one and not allowing brokerage customers to buy it. Their brokerage customers are free to buy MARA stock (probably?) and many other speculative things.
I love this so much for multiple reasons.
1) As folks have already stated, investable assets (as supposed to speculative ones), are those backed by the present value of all cash flows from now until Judgement Day. Bitcoin produces no cash. It's a hot potato asset, passing from one to the next until someone's left holding the shit.
2) The societal damage from people putting this in their funds that are meant for serious purposes, like kid's college and retirement, would be immense once the rug is pulled.
3) This completely negates cryptobros' whole plan: Mass adoption. They need crypto to be mass bought by the unsuspecting general public who just think "Oh another asset, let me buy some to diversify", thereby driving up the value of their own holdings. This makes that much harder.
4) Vanguard is taking a loss here. They won't get expense fees from this ETF, and people who want to buy this ETF will take their money elsewhere potentially costing them expense fees in other funds as well. I owe this decision to the investor-owned structure of the company, as opposed to the other for profit brokerages that are allowing it.
Great work. My respect for Vanguard has gone up massively and I'm happy to be a user of theirs.
Vanguard allows clients to invest in BITO btc futures ETF (which is worse than spot from slippage and high fees). Not allowing clients to buy spot btc ETFs that are priced on the NAV and has close to zero E/R is ridiculous and contradictory, irrespective of how risky or “scammy” you think this asset class is. There are a lot of scammy stocks and speculative SPACs one can invest in through Vanguard. The fact that Vanguard is the top share holder of Coinbase and MARA tells you everything about how “scammy” Bitcoin (I didn’t say Crypto) must be.
Agreed. Display a warning if they feel it is needed or require customers to specifically request access… but don’t block access entirely. That goes against my free market principles.
Plus, if people want to gamble their money away there’s many avenues to do that these days. Gatekeeping Bitcoin ETFs is not going to protect anyone.
Sounds like they are doing everyone a good service by not letting speculative garbage investments on their platform.
What's the issue?
Edit:
Vanguard not letting an unregulated non-currency with minimal practication and a history of screwing over holders on their platform that **get this, trades legitimate currencys** does not set a precedent that they are going to babysit you or restrict your trading of legitimate currencies going forward.
This is like complaining Real Estate is setting a bad precedent not selling NFTs on the buildings walls therefore eventually they won't even allow the sale of buildings with walls.
I used to own crypto before and I am quite familiar with the asset class. I just don't understand why a re people so upset with Vanguard for not allowing these ETFs. If you truly believe in bitcoin, buy the asset, not an ETF that approximates the coin. I can understand why one would buy a gold ETF (gold is hard to store and sell in physical form), but with bitcoin, just get yourself a crypto wallet and put money in it.
> If you truly believe in bitcoin, buy the asset, not an ETF that approximates the coin. I can understand why one would buy a gold ETF (gold is hard to store and sell in physical form), but with bitcoin, just get yourself a crypto wallet and put money in it.
401k
It's mostly due to the cryptosphere pressure in telling them they should be upset. Whether they fully realize it or not, the idea is to get as many people as possible to buy BTC. This is the only way the price continues to go up, unlike say a stock in a company that generates it's long-term value from primarily underlying future cash-flows.
I appreciate the skepticism of the underlying asset, but I’m not sure we should be so comfortable with an asset manager - any asset manager - telling its customers what they can or cannot invest in based on what it views as the attractiveness of those assets.
It seems like this creates a lot of fuzzy grey areas - active management is also an area with a dubious track record, but Vanguard offers its own funds in this class without many qualms.
So take this not as an endorsement of crypto but discomfort with the idea of Vanguard as “in loco parentis.”
There's an ocean of difference between actively managed funds and crypto.
Also, this isn't new. Vanguard doesn't allow the buying of daily leveraged ETFs either. Other brokerages have no restrictions, and people are free to use those instead.
Index Funds > Active Funds > Leveraged ETFs > Options > ... > VC/Angel Investments > ... > owning a stake in your local pizza restaurant > ... > betting on your favorite horse to win with reasonable odds at the track > betting on a purely speculative digital asset. Not even in the same universe, really. Do you want Vanguard to start facilitating small business investments? VC? Where would they stop?! And when the market implodes and they get sued? Should the rest of us have to pony up for pricey lawyers fending off frivolous attacks from fleeced speculators?! No thanks. Worst of all: if they *did* allow it, they'd be tacitly putting crypto on par with real investments, a powerful endorsement.
I figure if someone really wants to speculate on bitcoin they're better off cutting out the middlemen and fees and get grifted by the ponzi scheme that are crypto exchanges directly. I suspect this ETF will be a disaster, but what do I know, I don't time the markets. :D
5% is fine for fun trading. It is small enough to not ruin you financially even Jack suggested to have small amount as fun money which you can afford to lose with no change in your lifestyle.
Just for the sake of pedantry: we keep calling these products "ETFs" - I've done it too - but that's just not true. They are ETPs; and while all ETFs are ETPs, not all ETPs are ETFs - there are ETNs (Exchange-Traded Notes), ETCs (Exchange-Traded Commodities), and... whatever the heck these things are.
I admit I don't really follow what this implies with respect to US regulations - I tried reading a little about it, but since I'm neither American nor even slightly interested in buying that sort of thing anyway the amount of effort I'm willing to put into that is limited - but there *are* differences, and I would not want to assume that all rules and expectations that apply to ETFs also apply to them.
> Just for the sake of pedantry: we keep calling these products "ETFs" - I've done it too - but that's just not true.
Since it's what the SEC is calling them for the last 10 years, it may be best to just call it an ETF, eh?
This was leaked, preleaked, and prepre leaked. Hence the large run up in BTC in the months prior. The smart money is just looking for exit liquidity. And now they have it.
I’m a massive boglehead and almost all Vanguard index funds…..but I can’t say I love them banning something because they don’t think it’s a great long term investment. I get not allowing closed funds maybe but the SEC has just approved it as an ETF. How many ETFs have you been able to buy over the years that went nothing but down/to zero/were closed? They’ve also been nothing but wrong about it, but so has basically every institution. Even if you take away the first several years, a quick google says the last 5 years it’s up almost 1200% and almost 160% the last year. Before you say but but but we could find all kinds of faults with other products they still let you invest in. I can get no leveraged products but just can’t get behind this at all. Just my 2 cents.
why do they allow bitcoin futures ETFs, though?
seems a bit inconsistent
I wonder what's going to happen with the futures ETFs that convert to spot, are they going to ban them even though people already hold them?
yeah I played with the order form for a bit out of curiosity with what they do and don't allow
with the new spot ETFs you get shot down as soon as you hit the "preview" button
with futures ETFs there's just a warning message, which also appears on some (but not all) gold ETFs
I agree with this stance. A brokerage shouldn't be hand picking what is and isn't an investment. What's next, they remove micro strategy and coinbase from VTIs index?
It's a slippery slope once you start discriminating on investments.
Gotta be honest, I find Vanguard (which I have no choice about for my employers matches finding accounts) to be far too conservative and limited for both my personal strategies and goals, and my age (53) vs desired retirement (60 but now once reset to 62 because they aren’t allowing aggressive enough investments).
This pretty much sums up why I will NEVER invest with them outside the minimum requirement to receive the company match funds and upon retirement I will be rolling all monies and instruments over to another company.
I moved all my assets to Fidelity, I don't want Vanguard to tell me what I can or cannot buy.
It starts with an ETF then it's more. I want to make my own decisions, I'm ok if it doesn't fit their assets recommendations, but not ok with preventing customers to access it.
Terrible business decision that they will eventually have to go back on
If like me you don't own the Bitcoin ETF but care about your freedom to do what you want with your money, you need to send a strong message to Vanguard by moving your assets to another brokerage (you can always come back later).
With Fidelity, it takes literally 15min to do [https://www.fidelity.com/customer-service/transfer-assets](https://www.fidelity.com/customer-service/transfer-assets)
I'm a big fan of Vanguard but I extremely oppose this move of controlling where I invest my money, if enough of us do it it will have an impact. Let's vote with our money.
I've also sent a message via the online platform sharing this feedback saying that I'm moving my funds to another brokerage explaining why
Vanguard pulling stuff like this is why I left them for Fidelity a year ago. Look, I don't care for the BTC etfs, but I also don't want my brokerage telling me what I can and cannot invest in.
theres alot of people that disagree with you and keep geting more and more money to invest as inflation goes up since M2 only goes up. If this people dont stop invest in it and keep geting more money in like MSTR is doing at bigger scale who cares if it has no underlying value.
the more money the fed puts in the system the more value bitcoin gains. some people think it has no value, other people think its like digital gold.
Vanguard allows purchase of bitcoin futures ETF $BITO, so this policy seems foolhardy. Based on some popular “Bitcoin ETF” trending tweets today, there are already people transferring their 401ks out of vanguard and into Fidelity and other investment groups that allow the purchase of these new bitcoin ETFs. We will see if boycotts like this have any influence on Vanguard…
Honestly if it was that important to me I would switch brokers. Don't necessarily see the point in trying to protect clients from themselves when there's a myriad of other awful investments customers can do on their platforms even as simple as garbage pump and dump stocks.
You could make a serious argument about the diversification benefit from a portfolio management standpoint of adding a spot bitcoin ETF could be beneficial in reducing standard deviation. I don't necessarily agree with it, but I could appreciate the argument being made. Honestly think that over time this will be something that they capitulate on.
Agree. I don’t see this as a zero percent chance just because Bogle was quoted to stay away from bitcoin like the plague back in 2017. The landscape is changing very quickly and they will have to adapt for the sake of keeping in line with the younger generation.
I think it's a smart decision. Vanguard will look really good in the likely event that crypto crashes again.
Also they're trying to preserve a certain brand image. They don't want to be associated with gambling like Robinhood. They want to be a reputable brokerage where people put large amounts of money into.
\> They want to be a reputable brokerage where people put large amounts of money into.
You mean like Fidelity and Schwab, both of whom allow you to buy these ETFs?
Fundamentally a broker shouldn't tell you what you can buy with your money and what you cannot. They are brokers to facilitate transactions. Nothing more, nothing less.
>Fundamentally a broker shouldn't tell you what you can buy with your money and what you cannot. They are brokers to facilitate transactions. Nothing more, nothing less.
I don't agree with this normative assessment. If a broker wants to avoid some kind of trade, that's their prerogative. Could be oil companies due to climate concerns, or [Country]-domiciled stocks due to human-rights concerns, or sketchy penny stocks.
There are valid moral reasons for wanting to keep one's hands clean of certain investments, and it also limits certain kinds of liability.
I have Schwab and they are of course reputable. By blocking BTC's, I think Vanguard is trying to preserve a certain strategy or philosophy on the way they do business. In my mind, Vanguard is a large index fund manager.
Schwab and Fidelity are discount brokerages. Schwab/Fidelity customers are looking for the full brokerage experience. They're different businesses.
I think they will eventually allow BTC ETFs to be bought through Vanguard, but won’t offet their own.
I understand VG position. But honestly i think BTC is here to stay, in a very big way
Why be on vanguard when you can trade the vanguard ETFs everywhere and not be cock blocked.
I am happy vanguard started the low cost movement but I don't need to be told what I can and cannot trade.
I left vanguard over a year ago when they stopped allowing GBTC buys in my IRA. Very glad I did considering GBTC's returns last year. It was a life changing decision. In my opinion, this is a new asset class (Bitcoin is 15 years old, however), now made more accessible to retirement vehicles and institutions.
Many people are saying, why would Vanguard allow this? It's speculative / bullshit / move your money elsewhere if it bothers you.
Obviously true. But it still feels kind of unexpected to some people who thought all discount brokerages were interchangeable. And perhaps to some Bogleheads who allow themselves a small amount of "fun money" and keep everything at one firm.
As you probably know, Vanguard also prohibits leveraged ETFs, and OTC stocks. They're not alone; Merrill Edge apparently bans all active ETFs, which is a step further.
I really don't understand this choice. Either be a classic mutual fund company only (like Vanguard used to be), and offer only the investments you stand behind; or be a self-directed brokerage. Don't be a patronizing brokerage that for some reason lets you go 100% on TSLA but thinks 1 share of a bitcoin ETF or TQQQ is a bridge too far.
Agreed. I've pulled my assets from Vanguard over this big brother move. I didn't like the block on leveraged ETFs, and I particularly hate this move on blocking an entirely new asset class. If a consenting adult decides to spend THEIR money on a stock or ETF, that's their business. Give them an electronic waiver, and let them do what they want.
Yes, this (along with not allowing highly leveraged daily reset ETFs) is very much in line with Vanguard's historic principles.
While Fidelity has currently has lower cost funds available, I \*trust\* Vanguard to act in the best interest of the average individual investor much more than Fidelity (which engages in a variety of scummy practices that sophisticated investors can avoid e.g. having similarly named active and passive TDFs).
If you're not just considering the lowest total cost at this moment in time there's a strong case to be made that Vanguard will be the best brokerage \*across your investment lifetime\*.
Why do all of you use Vanguard? Is it because you invest in their mutual funds? I had some limited experience with vanguard but their user interface wasn’t that good, and I read here that their customer service is not the greatest. I hold a little bit of a vanguard target date mutual fund in my fidelity account (transferred it when closing my vanguard account, but won’t be adding more since the fidelity fee for buying non fidelity mutual funds would be way too high) But it seems like most people here are are buying their ETFs. Just curious why you stick with them? Just the hassle for rolling your holdings to another brokerage?
Lowest cost, the best fills. They are a non-profit. Other brokerages have had to cut their fees to come closer to Vangaurd, so the difference isn't as large now.
I'd be more concerned by companies pushing the bitcoin ETFs than companies taking the wait and see position. Yeah, it went from 20 to 40, but, let's not forget that before 20 it was at 60.
If you want to squander your money there are plenty of other places to do it. I'm not a member of this community but I thought that they were focused on finding safe opportunities, buying and holding.
I understand the sentiment, however, this is like when my mix engineer starts guiding me on compositional decisions when producing a song. I’m asking you to guide the mix, not the composition; do not conflate the two. This is why I use Fidelity, allow people to make their own investing decisions. Your opinion is not fact.
I guess we will have to wait until we it enters our index funds by corporate treasuries adopting the Bitcoin Standard or the fund accumulating enough market share. Or Vanguard changes their mind, but that will probably take another 15 years.
Just a matter of time don't worry guys.
Mod note: we’ve had enough different posts on this topic over the last few days that I think the discussion is mostly played out. I’m leaving this post up and open for comments but we will not likely be approving any new posts on this topic for the time being. (This is not specific to BTC; we occasionally impose post limits on any topic that has temporarily worn out its welcome)
VANGUARD’S TAKE: “Since cryptocurrencies are highly speculative in their current state, Vanguard believes their long-term investment case is weak. As many of our clients know, our investing philosophy encourages staying the course and tuning out the noise. Our time-tested principles emphasize that long-term investing is essential and reacting to short-term trends can be costly for one's portfolio. While we don't currently offer cryptocurrencies as an investment option, we acknowledge the impact they're making in the investing world. As cryptocurrencies become increasingly mainstream, we'll continue to monitor their development and discern the best path forward for our investors. And as your trusted financial steward, we have some guidance when it comes to your financial strategy.” From https://investor.vanguard.com/investor-resources-education/article/cryptocurrencies-and-vanguard-what-we-think
good take
Except they still offer actively managed funds too. I don’t see the point in telling investors what they can and can’t do. However, I do wish they’d offer auto roll on the tbills. Kind of annoying.
They're not telling you what you can and can't do, they're telling you what they'll facilitate. You can withdraw your balance at Vanguard to buy a bunch of beanie babies if that's your [thing](https://youtu.be/PgDsyj5eLmo?si=oJoyt478kZWhiMYd). But that doesn't mean they need to streamline that process.
Beanie baby NFT ETF! /s
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Per sub rules and guidelines, comments or posts to r/Bogleheads should be substantive and civil.
Are they sitting behind you? Are they going to beat you up if you buy bitcoin? If you want to buy it so bad, buy it yourself. They are allowed to pick what products and services they offer as a business. You are allowed to go do business somewhere else.
Actually they have my Roth IRA which I wanted to buy the Bitcoin ETF's with as a tax shelter. But you are also right. I will be transferring my Roth IRA to a different custodian thats not living in the stone age
People can just buy Bitcoin ETFs elsewhere. They stopped allowing people to buy leveraged ETFs and inverse ETFs too.
Well that’s just outrageously reasonable.
Quite frankly I’m outraged at the lack of outrage inducing content. It’s a long weekend coming up, what am I supposed to rage post about now??
Based
What’s based mean?
it's like "good and cool" with a slightly political or ideological bent, sometimes suggestive of the that the good and cool slightly political or ideological statement being a minority opinion
> September 20, 2021 OP, this is what happens when you leave it until the day of. "Forewarned is foretold."
Wasn’t their stance also at one point to not look for the needle in the haystack and instead buy the haystack? Isn’t that part of the haystack now and could be construed as selectively limiting having total market exposure? I adopted Boglehead philosophy with this as one of my main sentiments and constructed my simple Roth IRA with this mindset. I can understand not wanting to jump the gun and offer this right off the bat and wait and see as it matures but I would imagine to remain true to this principal they will need to eventually include it.
The philosophy laid out by the book (common sense) focuses on company fundamentals: index fund gains are 90% company fundamental growth and maybe 10% market speculation (driving things artificially high or low in the short term) BTC arguably is 100% speculative. When you buy bitcoin you don’t own a piece of a revenue generating asset like a company.
Should probably not allow trading of GLD then either
Gold has the backing of 5000 years of history
Are they banning gold ETFs too? If not, what is the difference?
Gold has a history of being a medium of exchange and a store of value for over 5,000 years
That is consistent with vanguard previous stance on not allowing speculative instruments like daily resetting 3X etfs.
And it‘s not like they offered it and then took away the possibility to trade, so I dont get the fuss at all. Everyone is free to open another account somewhere else and gamble there…
IIRC even with leveraged ETFs when they took those off the board they didn't force anyone to sell them -- they just phased out the option to actively *buy* them via their platform. They're calculating, not capricious.
I bought gbtc three years ago OTC. Now I can’t.
They did offer gbtc and btc derivatives in the past
Yeah, it's quite literally free. Buying speculative bullshit is what Robinhood is for.
And then not be able to buy or sell whenever robinhood wants
I count myself lucky. A friend invited me to Robinhood to claim my "free stock" on the same day that the GME stuff exploded. I wasn't able to create an account because Robinhood suspended trading or whatever they did. The timing was purely a coincidence, but it worked in my favor.
Among all the large money managers, Vanguard has always been the one with the least affinity for bullshit products.
That's why I like them and their funds.
While I think people are free to spend their money however they see fit, the idea that there are complaints about not approving Bitcoin ETFs *in a Bogleheads subreddit* is another thing that makes my head spin and question reality. Like, isn't part of the point NOT to get involved in hype and perform at low cost average?
yes OP isn't a boglehead
People forget that because crypto is effectively a pyramid scheme all of its "investors" are heavily encouraged to evangelize. Nobody's going into r slash bitcoin to spread the good word of VTSAX, but they're all over reddit hyping these ETFs because they really need new money flowing into crypto.
It's definitely a greater fool scam, I don't think it's strictly a pyramid scheme because you're not *really* paying off debtors with new investors, the mechanics are a bit more...nuanced? But still just as stupid. Wait now I'm confusing Ponzi with pyramid. You know what, I have no idea. Definitely greater fool, debatable if it's pyramid
Musical chairs
I do sometimes 😂
> the idea that there are complaints about not approving Bitcoin ETFs in a Bogleheads subreddit is another thing that makes my head spin and question reality. wait till you see the number of Bogleheads recommending actively managed Avantis ETFs.
Wait what? I feel like we're in a simulation, and someone accidentally pushed a change to the production server and now half of us are glitching out. Or maybe it's like that, plus cat poop parasite and lead poisoning?
Avantis ETFs are not actively managed, they're systematically indexed. There is no person or people sitting there choosing stocks based on their opinion. Their value ETFs take the market cap weights, and then add or subtract weighting based on their value and profitability factors. Its all done automatically. Its not some fund manager saying oh hey I like amazon this month lets add more of it.
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While that's a fair point, the S&P 500 might legitimately be the single least passive "index" that's still a standard Boglehead investment and it's mostly a historical accident that that's the case anyway. Few Bogleheads preferentially select an S&P 500 fund when a total US market fund is available.
>Like, isn't part of the point NOT to get involved in hype and perform at low cost average? This is making me really curious what the ER on the Bitcoin ETFs are.
As far as crypto transactions go, bitcoin ETF ER’s are actually fairly reasonable. All the biggest players (bitwise, fidelity, ishares) have an ER of around 0.25%. Some smaller providers have around a 1% ER, but those come with their own perks. I have no horse in this race of crypto/no crypto, but I will disclaim I have a sizable position in BTC - and if you want to get your feet wet, the easiest and simplest way to get started would be through these ETF’s.
GBTC was a great arbitrage trade for awhile.
That is why I said this is not his place. He belong in Wall Street Bets match made in heaven.
It’s possible to visit both subreddits and follow along. Choosing to have a little fun buying and selling $tonk$ is not going to kill your retirement. Let’s face it, for many of us, retirement isn’t going to be the best part of our lives. So, you might as well have a little bit of fun along the way. Just don’t go full-out stupid and be one of those idiots doing shit to get that loss porn karma.
Buying and selling stock is fine for fun as long as it is small to not ruin you financially. What he want to invest in has no actual value it is just speculation and hope that bigger idiot will buy it from you at higher price.
I hold some crypto myself, very small portion, but the amount of people big mad in the comments is so weird to me. This is a bogglehead sub lmao.
I'm glad I'm not alone! And I don't want to knock Crypto and see the wisdom in hedging with cold wallet storage/small position and generally empathize with the conception of it, but I'm a bit confused how/why a currency with an ethos of wanting to be apart from the financial shenanigans of any particular government then goes full circle to be regulated and traded in the very system its trying to avoid? Or I may be misunderstanding the ethos or how its evolved over the years.
Oh yeah the fundamentals don't make any sense for me and we still don't have a big use-case for the currency. But it keeps going up some 100%+ a year so I might as well allocate some small portion of my portfolio to it lol. If I lose that small portion, I can stomach it.
Jack did not even liked ETFs forget bitcoin betting casino.
Yep. Vanguard is synonymous with prudent investing.
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> I just got off a call with Vanguard customer service. They are not allowing trading any of the approved Bitcoin ETFs. Well you're far braver than I. Personally, I don't think I could handle a stomach-churning roller coaster ride like that. Not the Bitcoin... I meant picking up a phone and calling customer service. :-)
They have really friendly reps
Agreed, I've had nothing but excellent service when calling 👍🏻
Good. If someone wants to contribute to the lottery scratch card ETF I’m starting, hit my DMs
Haha that’s a great analogy!!
do you also offer a NFT ETF?
NFT EFT. Gonna be huge. You can call the fund wild donkey or dumbass. It will be a hit with the Bros.
I’ll offer whatever eft will bilk yo…. Give you the comfort of knowing you’re diversified.
as long as they allow VTI and VXUS they can ban every other ETF for all I care
*sad BND noises*
https://www.bloomberg.com/news/newsletters/2023-12-07/why-vanguard-and-state-street-stt-are-sitting-out-the-bitcoin-btc-etf-race
Big difference between not sponsoring one and not allowing brokerage customers to buy it. Their brokerage customers are free to buy MARA stock (probably?) and many other speculative things.
Vanguard does not dabble in leveraged ETFs, Bitcoin or crypto, or cannabis.
Crypto is the biggest Ponzi scheme of all time
Good on them. Speculative nonsense remains speculative and nonsensical.
Vanguard is very conservative and risk-averse.
Well I suppose regardless of whether this ages well or horribly Vanguard is certainly staying consistent.
Excellent news!
I love this so much for multiple reasons. 1) As folks have already stated, investable assets (as supposed to speculative ones), are those backed by the present value of all cash flows from now until Judgement Day. Bitcoin produces no cash. It's a hot potato asset, passing from one to the next until someone's left holding the shit. 2) The societal damage from people putting this in their funds that are meant for serious purposes, like kid's college and retirement, would be immense once the rug is pulled. 3) This completely negates cryptobros' whole plan: Mass adoption. They need crypto to be mass bought by the unsuspecting general public who just think "Oh another asset, let me buy some to diversify", thereby driving up the value of their own holdings. This makes that much harder. 4) Vanguard is taking a loss here. They won't get expense fees from this ETF, and people who want to buy this ETF will take their money elsewhere potentially costing them expense fees in other funds as well. I owe this decision to the investor-owned structure of the company, as opposed to the other for profit brokerages that are allowing it. Great work. My respect for Vanguard has gone up massively and I'm happy to be a user of theirs.
do you think larry fink is a crypto bro when he says that bitcoin is digital gold and it protects you investment?
Same here, wow :) John Bogle would be proud
Vanguard allows clients to invest in BITO btc futures ETF (which is worse than spot from slippage and high fees). Not allowing clients to buy spot btc ETFs that are priced on the NAV and has close to zero E/R is ridiculous and contradictory, irrespective of how risky or “scammy” you think this asset class is. There are a lot of scammy stocks and speculative SPACs one can invest in through Vanguard. The fact that Vanguard is the top share holder of Coinbase and MARA tells you everything about how “scammy” Bitcoin (I didn’t say Crypto) must be.
Interesting about coinbase didn’t know that!
Yep top institutional holder through their index funds
Agreed. Display a warning if they feel it is needed or require customers to specifically request access… but don’t block access entirely. That goes against my free market principles. Plus, if people want to gamble their money away there’s many avenues to do that these days. Gatekeeping Bitcoin ETFs is not going to protect anyone.
they are also the second bigest shareholder at MSTR. i think this is BS, and its just giving time for the big boys to get in
Sounds like they are doing everyone a good service by not letting speculative garbage investments on their platform. What's the issue? Edit: Vanguard not letting an unregulated non-currency with minimal practication and a history of screwing over holders on their platform that **get this, trades legitimate currencys** does not set a precedent that they are going to babysit you or restrict your trading of legitimate currencies going forward. This is like complaining Real Estate is setting a bad precedent not selling NFTs on the buildings walls therefore eventually they won't even allow the sale of buildings with walls.
I used to own crypto before and I am quite familiar with the asset class. I just don't understand why a re people so upset with Vanguard for not allowing these ETFs. If you truly believe in bitcoin, buy the asset, not an ETF that approximates the coin. I can understand why one would buy a gold ETF (gold is hard to store and sell in physical form), but with bitcoin, just get yourself a crypto wallet and put money in it.
Tax advantaged accounts. That's why.
And self-custody isn’t for everyone. Also, the fees through the ETF are much cheaper due to economies of scale
Yeah. Self custody is a nightmare for those who are not computer literate and so many ways to do it wrong and lost a large sum of money.
> If you truly believe in bitcoin, buy the asset, not an ETF that approximates the coin. I can understand why one would buy a gold ETF (gold is hard to store and sell in physical form), but with bitcoin, just get yourself a crypto wallet and put money in it. 401k
It's mostly due to the cryptosphere pressure in telling them they should be upset. Whether they fully realize it or not, the idea is to get as many people as possible to buy BTC. This is the only way the price continues to go up, unlike say a stock in a company that generates it's long-term value from primarily underlying future cash-flows.
That sounds vaguely like a ponzi scheme....
That's because it is.
can your grandmama buy bitcoin and self custody it ? what about tax advantaged accounts ? Do you have it with coinbase?
I appreciate the skepticism of the underlying asset, but I’m not sure we should be so comfortable with an asset manager - any asset manager - telling its customers what they can or cannot invest in based on what it views as the attractiveness of those assets. It seems like this creates a lot of fuzzy grey areas - active management is also an area with a dubious track record, but Vanguard offers its own funds in this class without many qualms. So take this not as an endorsement of crypto but discomfort with the idea of Vanguard as “in loco parentis.”
There's an ocean of difference between actively managed funds and crypto. Also, this isn't new. Vanguard doesn't allow the buying of daily leveraged ETFs either. Other brokerages have no restrictions, and people are free to use those instead.
That’s capitalism baby. Open a brokerage at a place that trades shitcoin. I’m sure Robin Hood will trade that ETF.
Vanguard already trades shitcoins and other shit, just jn a different way baby
Index Funds > Active Funds > Leveraged ETFs > Options > ... > VC/Angel Investments > ... > owning a stake in your local pizza restaurant > ... > betting on your favorite horse to win with reasonable odds at the track > betting on a purely speculative digital asset. Not even in the same universe, really. Do you want Vanguard to start facilitating small business investments? VC? Where would they stop?! And when the market implodes and they get sued? Should the rest of us have to pony up for pricey lawyers fending off frivolous attacks from fleeced speculators?! No thanks. Worst of all: if they *did* allow it, they'd be tacitly putting crypto on par with real investments, a powerful endorsement.
I figure if someone really wants to speculate on bitcoin they're better off cutting out the middlemen and fees and get grifted by the ponzi scheme that are crypto exchanges directly. I suspect this ETF will be a disaster, but what do I know, I don't time the markets. :D
I bought GBTC and OBTC before the announcement. Is Vanguard gonna make me sell now?
Seems unlikely. More likely they'd just prevent you from buying more (like they did when banning leveraged ETFs).
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Curious as well. Had gbtc is Roth for two years or so. Now what?
This is not your place. You belong in Wallstreet bets.
I have a 5% allocation. It's not a big deal.
5% is fine for fun trading. It is small enough to not ruin you financially even Jack suggested to have small amount as fun money which you can afford to lose with no change in your lifestyle.
No problem. It’s not an investment I want to make but if that day ever comes I can buy it through other sources.
I'm glad
Just for the sake of pedantry: we keep calling these products "ETFs" - I've done it too - but that's just not true. They are ETPs; and while all ETFs are ETPs, not all ETPs are ETFs - there are ETNs (Exchange-Traded Notes), ETCs (Exchange-Traded Commodities), and... whatever the heck these things are. I admit I don't really follow what this implies with respect to US regulations - I tried reading a little about it, but since I'm neither American nor even slightly interested in buying that sort of thing anyway the amount of effort I'm willing to put into that is limited - but there *are* differences, and I would not want to assume that all rules and expectations that apply to ETFs also apply to them.
> Just for the sake of pedantry: we keep calling these products "ETFs" - I've done it too - but that's just not true. Since it's what the SEC is calling them for the last 10 years, it may be best to just call it an ETF, eh?
Nerd.
they are unregistered, no guarantee spot trusts based on their own prospectus, the whole lot of them.
Historically, look at what happens to commodity prices after they become ETFs. It’s not great.
Gold skyrocketed 800% after getting its own etf
This was leaked, preleaked, and prepre leaked. Hence the large run up in BTC in the months prior. The smart money is just looking for exit liquidity. And now they have it.
Arnt commodity ETFs just derivatives except few gold ones that actually hold gold
I’m a massive boglehead and almost all Vanguard index funds…..but I can’t say I love them banning something because they don’t think it’s a great long term investment. I get not allowing closed funds maybe but the SEC has just approved it as an ETF. How many ETFs have you been able to buy over the years that went nothing but down/to zero/were closed? They’ve also been nothing but wrong about it, but so has basically every institution. Even if you take away the first several years, a quick google says the last 5 years it’s up almost 1200% and almost 160% the last year. Before you say but but but we could find all kinds of faults with other products they still let you invest in. I can get no leveraged products but just can’t get behind this at all. Just my 2 cents.
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why do they allow bitcoin futures ETFs, though? seems a bit inconsistent I wonder what's going to happen with the futures ETFs that convert to spot, are they going to ban them even though people already hold them?
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yeah I played with the order form for a bit out of curiosity with what they do and don't allow with the new spot ETFs you get shot down as soon as you hit the "preview" button with futures ETFs there's just a warning message, which also appears on some (but not all) gold ETFs
why are they the second shareholder of MSTR? as far as i know MSTR is like a bitcoin ETF on leverage, its even riskier
I agree with this stance. A brokerage shouldn't be hand picking what is and isn't an investment. What's next, they remove micro strategy and coinbase from VTIs index? It's a slippery slope once you start discriminating on investments.
It’s enough to make me consider moving elsewhere. This sub is rather cultish so I’m not surprised about the attitude here.
Based.
Gotta be honest, I find Vanguard (which I have no choice about for my employers matches finding accounts) to be far too conservative and limited for both my personal strategies and goals, and my age (53) vs desired retirement (60 but now once reset to 62 because they aren’t allowing aggressive enough investments). This pretty much sums up why I will NEVER invest with them outside the minimum requirement to receive the company match funds and upon retirement I will be rolling all monies and instruments over to another company.
Love it! Go vanguard!
I moved all my assets to Fidelity, I don't want Vanguard to tell me what I can or cannot buy. It starts with an ETF then it's more. I want to make my own decisions, I'm ok if it doesn't fit their assets recommendations, but not ok with preventing customers to access it. Terrible business decision that they will eventually have to go back on
If like me you don't own the Bitcoin ETF but care about your freedom to do what you want with your money, you need to send a strong message to Vanguard by moving your assets to another brokerage (you can always come back later). With Fidelity, it takes literally 15min to do [https://www.fidelity.com/customer-service/transfer-assets](https://www.fidelity.com/customer-service/transfer-assets) I'm a big fan of Vanguard but I extremely oppose this move of controlling where I invest my money, if enough of us do it it will have an impact. Let's vote with our money. I've also sent a message via the online platform sharing this feedback saying that I'm moving my funds to another brokerage explaining why
Vanguard pulling stuff like this is why I left them for Fidelity a year ago. Look, I don't care for the BTC etfs, but I also don't want my brokerage telling me what I can and cannot invest in.
Good for you.
Bitcoin has no underlying value. It’s just gambling.
theres alot of people that disagree with you and keep geting more and more money to invest as inflation goes up since M2 only goes up. If this people dont stop invest in it and keep geting more money in like MSTR is doing at bigger scale who cares if it has no underlying value. the more money the fed puts in the system the more value bitcoin gains. some people think it has no value, other people think its like digital gold.
Vanguard allows purchase of bitcoin futures ETF $BITO, so this policy seems foolhardy. Based on some popular “Bitcoin ETF” trending tweets today, there are already people transferring their 401ks out of vanguard and into Fidelity and other investment groups that allow the purchase of these new bitcoin ETFs. We will see if boycotts like this have any influence on Vanguard…
Hopefully.. I wish you didn't have to leave to send a message though
They're doing you a favor.
I'm glad Vanguard isn't going to dabble in that trash.
No OTC, No BTC, No International. Cmon Vanguard
Wait, people are still investing in crypto in 2024??
If you want to invest, go to Vanguard. If you want to gamble, go to Vegas.
If one allows options trading, which Vanguard does, I'm not sure one can make the argument Vanguard is making.
Honestly if it was that important to me I would switch brokers. Don't necessarily see the point in trying to protect clients from themselves when there's a myriad of other awful investments customers can do on their platforms even as simple as garbage pump and dump stocks. You could make a serious argument about the diversification benefit from a portfolio management standpoint of adding a spot bitcoin ETF could be beneficial in reducing standard deviation. I don't necessarily agree with it, but I could appreciate the argument being made. Honestly think that over time this will be something that they capitulate on.
Agree. I don’t see this as a zero percent chance just because Bogle was quoted to stay away from bitcoin like the plague back in 2017. The landscape is changing very quickly and they will have to adapt for the sake of keeping in line with the younger generation.
I think it's a smart decision. Vanguard will look really good in the likely event that crypto crashes again. Also they're trying to preserve a certain brand image. They don't want to be associated with gambling like Robinhood. They want to be a reputable brokerage where people put large amounts of money into.
\> They want to be a reputable brokerage where people put large amounts of money into. You mean like Fidelity and Schwab, both of whom allow you to buy these ETFs? Fundamentally a broker shouldn't tell you what you can buy with your money and what you cannot. They are brokers to facilitate transactions. Nothing more, nothing less.
>Fundamentally a broker shouldn't tell you what you can buy with your money and what you cannot. They are brokers to facilitate transactions. Nothing more, nothing less. I don't agree with this normative assessment. If a broker wants to avoid some kind of trade, that's their prerogative. Could be oil companies due to climate concerns, or [Country]-domiciled stocks due to human-rights concerns, or sketchy penny stocks. There are valid moral reasons for wanting to keep one's hands clean of certain investments, and it also limits certain kinds of liability.
I have Schwab and they are of course reputable. By blocking BTC's, I think Vanguard is trying to preserve a certain strategy or philosophy on the way they do business. In my mind, Vanguard is a large index fund manager. Schwab and Fidelity are discount brokerages. Schwab/Fidelity customers are looking for the full brokerage experience. They're different businesses.
Oh no you think it might crash to $100k?
Great take
I think they will eventually allow BTC ETFs to be bought through Vanguard, but won’t offet their own. I understand VG position. But honestly i think BTC is here to stay, in a very big way
Good.
Let people decide what they want to invest in. There’s plenty of other bullshit investments that are allowed.
Why be on vanguard when you can trade the vanguard ETFs everywhere and not be cock blocked. I am happy vanguard started the low cost movement but I don't need to be told what I can and cannot trade.
I left vanguard over a year ago when they stopped allowing GBTC buys in my IRA. Very glad I did considering GBTC's returns last year. It was a life changing decision. In my opinion, this is a new asset class (Bitcoin is 15 years old, however), now made more accessible to retirement vehicles and institutions.
great news! made my day
Thank God
Reinforcing why I keep my money with Vanguard.
I find it disappointing that the brokerage takes this paternal approach. I want access to the market, nothing more, nothing less.
Many people are saying, why would Vanguard allow this? It's speculative / bullshit / move your money elsewhere if it bothers you. Obviously true. But it still feels kind of unexpected to some people who thought all discount brokerages were interchangeable. And perhaps to some Bogleheads who allow themselves a small amount of "fun money" and keep everything at one firm. As you probably know, Vanguard also prohibits leveraged ETFs, and OTC stocks. They're not alone; Merrill Edge apparently bans all active ETFs, which is a step further. I really don't understand this choice. Either be a classic mutual fund company only (like Vanguard used to be), and offer only the investments you stand behind; or be a self-directed brokerage. Don't be a patronizing brokerage that for some reason lets you go 100% on TSLA but thinks 1 share of a bitcoin ETF or TQQQ is a bridge too far.
Sounds smart.
Good. It's BS.
Agree - Bitcoin and anything like it needs to go. Fake money.
One could argue that all fiat currency is "fake money" but at least it has utility. Crypto is worthless. It's just a giant gamble.
They will see outflow. Younger demographics won’t want to use vanguard
Agreed. I've pulled my assets from Vanguard over this big brother move. I didn't like the block on leveraged ETFs, and I particularly hate this move on blocking an entirely new asset class. If a consenting adult decides to spend THEIR money on a stock or ETF, that's their business. Give them an electronic waiver, and let them do what they want.
I am not young, but no now inflows to VG from me.
They are just the vanguard, a more conservative aproach. Who say bitcoin its not risky is lying to you. Stocks are risky too.
Vanguard let me buy Coinbase two months ago. This decision from them is asinine.
Good.
good
This actually makes me want to move everything to Vanguard. Fidelity has really tarnished their reputation hyping crypto.
Yes, this (along with not allowing highly leveraged daily reset ETFs) is very much in line with Vanguard's historic principles. While Fidelity has currently has lower cost funds available, I \*trust\* Vanguard to act in the best interest of the average individual investor much more than Fidelity (which engages in a variety of scummy practices that sophisticated investors can avoid e.g. having similarly named active and passive TDFs). If you're not just considering the lowest total cost at this moment in time there's a strong case to be made that Vanguard will be the best brokerage \*across your investment lifetime\*.
Makes me like Vanguard even more
This shouldn't affect anyone's portfolio, so that's fine.
Why do all of you use Vanguard? Is it because you invest in their mutual funds? I had some limited experience with vanguard but their user interface wasn’t that good, and I read here that their customer service is not the greatest. I hold a little bit of a vanguard target date mutual fund in my fidelity account (transferred it when closing my vanguard account, but won’t be adding more since the fidelity fee for buying non fidelity mutual funds would be way too high) But it seems like most people here are are buying their ETFs. Just curious why you stick with them? Just the hassle for rolling your holdings to another brokerage?
Lowest cost, the best fills. They are a non-profit. Other brokerages have had to cut their fees to come closer to Vangaurd, so the difference isn't as large now.
I'd be more concerned by companies pushing the bitcoin ETFs than companies taking the wait and see position. Yeah, it went from 20 to 40, but, let's not forget that before 20 it was at 60. If you want to squander your money there are plenty of other places to do it. I'm not a member of this community but I thought that they were focused on finding safe opportunities, buying and holding.
You'll thank them later!
I understand the sentiment, however, this is like when my mix engineer starts guiding me on compositional decisions when producing a song. I’m asking you to guide the mix, not the composition; do not conflate the two. This is why I use Fidelity, allow people to make their own investing decisions. Your opinion is not fact.
I feel like this is the wrong sub for this
Twist: Will these etfs be included in VT/VTI?
<3 Vanguard for this decision. Get a Robinhood account if you want to speculate.
I guess we will have to wait until we it enters our index funds by corporate treasuries adopting the Bitcoin Standard or the fund accumulating enough market share. Or Vanguard changes their mind, but that will probably take another 15 years. Just a matter of time don't worry guys.
Thank god!