that's a good point and one i was totally unaware of. i figured it was
just a close the account type of fee. maybe $50 per account. but
selling it, that's another thing. sheesh.

cporro wrote:
- quote -

This is a valid concern with any fund that is temporarily limiting its
expenses. If it doesn't grow enough by the time the contractual limit
expires, it might not be able to keep them low. Also - similar concern -
tracking error (deviation from the index) may be larger for smaller
index funds.

Another thing you should look into is whether you can transfer that fund
elsewhere through ACAT (the electronic platform for broker to broker
transfers). I wouldn't be surprised if it can only be custodied at
eTrade, but check if that's the case.

If it is, and they don't change that in the future, then buying the fund
commits you to eTrade, for that fund anyway -- you'd need to sell the
fund to move those dollars somewhere else. Some people don't like the
idea of being tied to one broker/custodian for the long term. I've seen
cases where an investor maintains an old brokerage account just for one
proprietary fund, that can't be ACAT-ed out. Selling would trigger so
much in capital gains taxes that it would wipe out years of minor cost
advantages of alternative funds they'd rather own. It's a
coulda-woulda-shoulda kind of thing, they're kind of stuck.

But this doesn't apply to all funds with names that sound proprietary.
For example I think Schwab's index funds can now be held elsewhere,
though that wasn't always the case. It's something to check fund-by-fund
-- I believe Yahoo includes it, as does Morningstar.

-Tad

i was checking vanguards site and could not find a similar statement.
maybe i missed it. i'm just afraid that this is an introductory offer
that will soon be changed. after all it is very very low. i'm also
trying to make a long term decision on where to keep my money. i don't
want to watch anything.

"Bucky" <uw_badgers[at]email.com> wrote in message
news:1170400586.414443.157180[at]s48g2000cws.googlegroups.com...

- quote -

If you're holding the fund in a taxable account, selling it requires you to
realize your capital gains.

On Feb 1, 4:37 pm, "cporro" <cpo...[at]gmail.com> wrote:
- quote -

Fidelity also had similar statements, but without a guaranteed date. I
doubt they would change the ratio, at least not all the way to .79%
because index funds are so competitive that if they did, most people
would sell and move to some other fund. So I think it's relatively
safe.

a bit of interesting fine print from the fees and expenses page for
ETSPX. becasue they charge a $25 transaction fee on my fav index fund
i started looking at Etrades index funds which have no tranaction fee.
this one has a .09% expense ratio. pretty good huh? then i read
this...

E*TRADE Asset Management, Inc. ("ETAM") has contractually agreed to
limit the expense ratio for the E*TRADE S&P 500 Index Fund until April
30, 2008. The expenses of the E*TRADE S&P 500 Index Fund prior to the
imposition of the contractual limit are, in fact, higher. Without the
contractual limits, the expenses of the Fund are .79% (based on most
recently filed shareholder report). There is no assurance that ETAM
will continue this expense limit beyond April 30, 2008.

what they seem to be saying is the expense ratio is due to increase in
april 2008 from .09% to .79%. anyone else have a take on this one?
here is the link. or maybe this is a typical cover our ass type of
statement and they will never actually change the ratio.

https://www.etrade.wallst.com/v1/sto...p?symbol=ETSPX