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Selling Old NISA; Buying New NISA
Posted: Thu Dec 14, 2023 10:29 am
by eyeswideshut
Hi everyone,
I had a random shower thought: As soon as 2024 rolls in I plan to sell all my assets in my 2019 NISA (about 2.2 million worth of emaxis slim all country) and rebuy the same into the new NISA - topping up to the 2.4 million limit. Then it hit me like a flash - every other punter out there is likely going to do the same thing! I then wondered if all of this mass selling and rebuying going to create aberrations in the fund price? I wonder if it might be better to DCA out and back in over time or hold off until in the initial storm of selling and buying has passed.
I don't know how liquid these funds are and how they set prices. I also have no idea how much money will be coming out of the 2019 NISAs in aggregate but I imagine it is a lot.
Is this a real worry or am i being paranoid? Can somebody smarter than me weigh in and convince me that I don't need to worry about it.
Re: Selling Old NISA; Buying New NISA
Posted: Thu Dec 14, 2023 11:30 am
by RetireJapan
Well, there are only about 20m NISA accounts in total, and we can assume a lot of them are dormant.
People opening new ones are going to be putting new money in.
So I doubt there will be enough volume to make a difference.
But you could always do it a couple of days later if you're worried
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Re: Selling Old NISA; Buying New NISA
Posted: Thu Dec 14, 2023 11:57 am
by Tsumitate Wrestler
RetireJapan wrote: βThu Dec 14, 2023 11:30 am
Well, there are only about 20m NISA accounts in total, and we can assume a lot of them are dormant.
People opening new ones are going to be putting new money in.
So I doubt there will be enough volume to make a difference.
Low-volume, low-market cap
domestic stocks? Possibly
Everything else? No
Re: Selling Old NISA; Buying New NISA
Posted: Thu Dec 14, 2023 10:46 pm
by eyeswideshut
RetireJapan wrote: βThu Dec 14, 2023 11:30 am
Well, there are only about 20m NISA accounts in total, and we can assume a lot of them are dormant.
People opening new ones are going to be putting new money in.
So I doubt there will be enough volume to make a difference.
But you could always do it a couple of days later if you're worried
Thanks - I suspect you are right but I am still concerned as there is no limit orders with these index funds so it will just sell at whatever the going rate is that day. I might monitor it for a bit and see how it plays out before placing my orders.
Re: Selling Old NISA; Buying New NISA
Posted: Fri Dec 15, 2023 3:56 am
by sutebayashi
I am thinking so long as you arrange your toshin sell orders and buy orders on the same day, then your sale and purchase prices should be the same.
To do this, one will need cash in the account sufficient to purchase the buy order though. Using a staggered approach would be a way to migrate in smaller chunks, if one does not have sufficient cash on hand.
Re: Selling Old NISA; Buying New NISA
Posted: Fri Dec 15, 2023 5:52 am
by eyeswideshut
sutebayashi wrote: βFri Dec 15, 2023 3:56 am
I am thinking so long as you arrange your toshin sell orders and buy orders on the same day, then your sale and purchase prices should be the same.
To do this, one will need cash in the account sufficient to purchase the buy order though. Using a staggered approach would be a way to migrate in smaller chunks, if one does not have sufficient cash on hand.
That is a great idea. Thanks! Are the spot prices set only once daily then?
Re: Selling Old NISA; Buying New NISA
Posted: Sat Dec 16, 2023 3:19 am
by sutebayashi
eyeswideshut wrote: βFri Dec 15, 2023 5:52 am
Are the spot prices set only once daily then?
Not sure the βspotβ terminology is correct, but thatβs the correct idea.
Say you put your Toshin buy / sell order in before 3pm one day, then your actual transaction price will typically be fixed on the next day.
This is described in the documents for the fund, because it is different depending on the assets being invested in, but yes I believe there is only one trade price per day, per fund, and it should be the same price for buying and selling, per memory.