T. Rowe Price - index funds - Americans

[coffeespoon]

Good morning everyone.

Today I have a few questions that I would like to ask you about index funds.

First, I have had an account with T. Rowe Price (US owned asset management firm) for about 10 years. They frown upon expats investing but I have been able to keep my account (so far) b/c I use the address of a relative that lives in the US.

I have been reading up on investments, and I know that index funds are the way to go. T. Rowe Price specializes in active management, but I did a quick search and found that they do have some index funds.

For example, I found one that invests heavily in US stocks, and another that invests heavily abroad.

"""""""""""""""""""

1.Equity Index 500 Fund
The fund seeks to track the performance of a benchmark index that measures the investment return of large-capitalization U.S. stocks.
Strategy. 99% domestic.
The fund attempts to match the investment return of large-capitalization U.S. stocks by seeking to match the performance of its benchmark index, the Standard & Poor's 500 Stock Index (S&P 500). The fund uses a full replication strategy, which involves investing substantially all of its assets in all of the stocks in the S&P 500 and seeking to maintain holdings of each stock in proportion to its weight in the index.

gross expense ratio' .2%
net expense ratio .21%
transaction fee none

2. International Equity Index Fund
The fund seeks to provide long-term capital growth.

gross expense ratio .46%
net expense ratio .46%
transaction fee none
""""""""""""""""""
3The gross expense ratio reflects the fund expenses as stated in the fee table of the fund’s prospectus prior to the deduction of any waiver or reimbursement. The net expense ratio reflects fund expenses after the deduction of any waiver or reimbursement. Expense ratios are as of the most recent prospectus.
"""""""""""""""""""""""""""""

I hear so many people talking about Vanguard and Schwab, etc., but not T. Rowe Price.

Question# 1 My first question is, do you think that the expense ratios are too expensive? (or is it forgivable?).

I am not so sure, b/c when I read about the expense ratios for index funds you can get through NISA, the expenses seem a lot less.

I am debating just investing in index funds through T. Rowe Price.... or if I should find something else on Tsumitate Nisa.

Question #2' -- if you are American, what are you investing in with Tsumitate Nisa?


Thank you for reading. I wish everyone a great day!!!

[captainspoke]

While TRP does have its own funds, I'll guess that they are a brokerage that can sell you anything that's listed on a major exchange--so probably the full range of ETFs from vanguard, fidelity, schwab, any of the iShares/PowerShares ETFs, etc.

They may also offer some non-TRP ETFs "commission free", so you might check on that.

[TokyoWart]

Those TRP expense ratios are not bad but a Vanguard ETF like VT or VTI will effectively have a lower management fee and not throw off the capital gains distributions the TRP mutual fund will.

Question #2' -- if you are American, what are you investing in with Tsumitate Nisa?

Although I started my NISA accounts before the Tsumitate version came on the scene, the potential for having to report the investment as a PFIC to the IRS is why I am sticking with stock investments in my regular NISA accounts.

[coffeespoon]

Thanks guys! I will check out if T Rowe Price offers those other ETS you (captainspoke) mentioned.

And TokyoWart, so when you say you do stock investment (regular stocks, not mutual, right?) with regular NISA, you don t have to worry about PFIC?

p.s. If I keep on asking many novice questions (and hence, my number of posts go up), will I be considered a veteran? funny

[TokyoWart]

And TokyoWart, so when you say you do stock investment (regular stocks, not mutual, right?) with regular NISA, you don t have to worry about PFIC

Yes, a regular stock in the NISA does not require the US PFIC reporting.