If I want to buy a $10K interest the Vanguard 500 portfolio, I could pay exactly $10K for VFIAX. Or I could pay a bit more for VOO shares representing the same $10K interest in the portfolio because of the added cost of the spread. I'd prefer not to pay more than $10K for $10K worth of securities.
Regardless of how large or small that added cost is, it is a drawback inherent in the ETF design. Though perhaps it is one that you may not personally care about.
Regarding the size of that spread, Ted's 1 basis point spread is more the exception than the rule. For example, CAPE has a typical spread of 15 basis points. Here's Vanguard's table of spreads on its ETF share class.
With SPY and VFINX Ted is comparing oranges and tangerines (close but still different). The question was what downsides there were to ETFs, not whether ETF 1 was better or worse than OEF 2.
The only way I know to do an apples to apples comparison using concrete funds rather than discussing different attributes of ETFs and OEF is to compare ETF and OEF shares of the same underlying portfolio. Say VFIAX vs. VOO. Since these are shares of the same portfolio, and since they have the same ER, the only factors affecting performance should be due to the nature of the shares and not of the particular fund.
Here's the M* comparison over the past ten years.
As of April 18, 2017, VFIAX'sVOO's cumulative return was 97.23%, while VOO's was 96.59%. That doesn't include dinging VOO for the cost of the spread.
If you add SPY to the M* comparison chart, you'll find its performance was even worse, at 95.66%. But that's because of the design of the fund (cash drag due to UIT structure plus higher ER). Those additional variables confound the data.
A tip for the linkster - to link to a M* page comparing funds, one needs to link to the chart page (there's a "share this chart" link there). The only fund that shows up when one links to a M* performance page is the original fund; the compared funds don't get passed through the link.

Hi @JoJo26,
I'm wondering if MSFAX is a fund that you own? Being an institutional fund the threshold to purchase is 5mil ... Do you know where it can be purchased back of the 5 mil?
Nice looking fund; but, beyond my capacity at 5mil!
Edit: After seeking out my own answer to the above question I found that IGFAX is the retail class for this fund and has no min or sales load and holds just short of 30 positions.
Trailing note: After running a performace test screen I'm sticking with THOAX although IGFAX (retail version) is far from being a shabby fund.

MSFBX is available on many platforms as a no-load/NTF.

And if you're one of those "do-gooders" with a tobacco-free mandate, then the fund certainly isn't for you. 3 top 10 positions are tobacco companies and this has been a historical bias because of their strong free cash flow generation.

A seasonality strategy I came across recently (sorry, no link) is to SELL when MACD goes negative (or other momentum stat threshold of your choice) on or after April 20, and BUY when MACD goes positive on or after October 16.
I've done something similar in the past, using simple moving averages, but can't claim any great success with it.

T Rowe Price US High Yield Fund registration filing:
https://www.sec.gov/Archives/edgar/data/754915/000075491517000016/uhy2ndfiling485a.htm
(Approximate Date of Proposed Public Offering May 22, 2017)

Old_Skeet: There's MSFBX and MSGFX Min. Inv. $1,000.
Regards,
Ted

@davidmoran: For once we agree. Here are the performance numbers for VFINX vs. SPY. SPY has an ER of.10% VFINX .14%
Regards,
Ted
http://performance.morningstar.com/fund/performance-return.action?t=VFINX&region=usa&culture=en_US

@MFO Members: Nonsense ! The truth is some thinly traded ETFs have very wide bid/ask spreads even if they hold very liquid stocks. The spread is the difference between the lowest price a trader is willing to sell the ETF and the highest price a buyer is willing to pay. The wider the spread, the bigger the immediate loss upon buying the ETF. Here is the current spread on SPY the worlds largest fund with 230.5 billion in assets. Bid/Ask/Spread 234.08/234.09. QQQ with 46.1 billion in assets 131.96/ 131.97.
Regards,
Ted

I'm also not a fan of ETFs. Though I can't speak for David, I suspect some of my objections overlap with his.
- bid/ask spread. With an ETF you're almost guaranteed to lose. (Even if you put in a limit order, that's primarily going to protect you against momentary market jiggles, not spread.) An OEF gives you 100c on the NAV dollar.
- tracking error. Not vs. the index (OEF index funds have the same propensity), but vs. the NAV (even after allowing for bid/ask spread). Authorized participants act to keep the price close to NAV, but only if their cost (trading the underlying securities plus the fee to convert creation units) is less than the deviation of the market price from NAV. They are less inclined to act when the market is in turmoil, i.e. when you're more likely to want to get out of a position.
There is a counter argument for foreign funds, viz. the market can price foreign index funds better than an OEF fund board using fair value pricing. Color me skeptical here. Even ETFs use fair value pricing when generating intraday indicative values.
- petty SEC Section 31 fees on ETF sales.
- often no cost advantage (e.g. Vanguard Admiral class shares vs. Vanguard ETF class shares of the same portfolio).
On the plus side for ETFs, in theory ETFs are more tax-efficient. I say in theory because many OEF broad based funds are well managed and distribute little if any cap gains as well. Nor does this matter in tax-advantaged accounts.
Another plus is that you can buy ETFs with lower commissions than you can buy TF funds.

Hi @Ted,
Some folks use the calendar; however, I use a twist put on the calendar and that is my market barometer and equity weighting matrix to assist me in when to throttle up (or down) my equity allocation.
I have written about my system often and if one wants to read more on my system then they can reference my post titled "The Markets and More."
I have linked my most recent April 13th post on "The Markets and More" below. In addition, this link provides another link to my 2475 call for the S&P 500 Index. I'm thinking that this will take place sometime during 4Q2017.
http://www.mutualfundobserver.com/discuss/discussion/32431/the-markets-and-more-week-ending-april-13-2017#latest

Hi @golub1,
I have three hybrid sleeves and with this I just decided to post a description of my sleeve management system along with current holdings which includes area allocations as of April 1, 2017. This does not include the seasonal revision to my portfolio's new overall allocations noted in my above post but it will provide fund holdings that you seek. Come fall, I'll most likely be back to the overall allocations described below.
Old_Skeet's Sleeve Management System
Now being in retirement here is a brief description of my sleeve management system which I organized to better help manage the investments held within mine & my wife’s combined portfolios. Currently, the master portfolio is comprised of two taxable investment accounts, two self directed ira accounts, a health savings account plus two bank accounts. With this, I came up with four investment areas. They are a cash area which consist of two sleeves … an investment cash sleeve and a demand cash sleeve. The next area is the income area which consists of two sleeves … a fixed income sleeve and a hybrid income sleeve. Then there is the growth & income area which has more risk associated with it than the income area and it consist of four sleeves … a global equity sleeve, a global hybrid sleeve, a domestic equity sleeve and a domestic hybrid sleeve. An finally there is the growth area, where the most risk in the portfolio is found and it consist of five sleeves … a global sleeve, a large/mid cap sleeve, a small/mid cap sleeve, a specialty/theme sleeve plus a special investment (spiff) sleeve. Each sleeve (in most cases) consists of three to nine funds with the size and the weight of each sleeve can easily be adjusted, from time-to-time, by adjusting the number of funds and amounts held the exception is the spiff sleeve. By using the sleeve system one can get a better picture of their overall investment landscape and weightings by sleeve and area. In addition, I have found it beneficial to Xray each fund, each sleeve, each investment area, and the portfolio as a whole quarterly. Again, weightings can be adjusted form time-to-time as to how I might be reading the markets along with using an adaptive allocation matrix as an aid to help set the stock allocation weighting. All funds pay their distributions to the cash area of the portfolio with the exception being those in my health savings accounts where reinvestment occurs. With the other accounts paying to the cash area builds the cash area of the portfolio to meet the portfolio’s monthly cash disbursement amount (if necessary) with the residual being left for new investment opportunity. Generally, in any one year, I take no more than a sum equal to one half of my portfolio’s average five year return. In this way, principal builds over time. In addition, most buy/sell trades settle from, or to, the cash area with some net asset value exchanges between funds taking place.
Last revised: 04/01/2017 Master Portfolio
Here is how I have my asset allocation broken out in percent ranges, by area. My neutral allocation weightings are cash 20%, income 30%, growth & income 35%, growth & other assets 15%. I do an Instant Xray analysis on the portfolio quarterly (sometimes monthly) and make asset weighting adjustments as I feel warranted based upon my assessment of the market, my risk tolerance, cash needs, etc. Currently, according to Morningstar Instant Xray, I am about 20% in the cash area, 25% in the income area, 35% domestic stocks area, 15% foreign stocks area & 5% in the other asset area. In addition, I have the portfolio set up in Morningstar’s Portfolio Manager by sleeve and as a whole for easy monitoring plus I use brokerage account statements along with some other Morningstar reports as well.
Cash Area (Weighting Range 15% to 25% with neutral weighting being 20%)
Demand Cash Sleeve… (Cash Distribution Accrual & Future Investment Accrual)
Investment Cash Sleeve … (Savings & Time Deposits)
Income Area (Weighting Range 25% to 35% with neutral weighting being 30%)
Fixed Income Sleeve: BAICX, CTFAX, FMTNX, GIFAX, LALDX, LBNDX, NEFZX, THIFX & TSIAX
Hybrid Income Sleeve: APIUX, CAPAX, DIFAX, FISCX, FKINX, ISFAX, JNBAX, PGBAX & PMAIX
Growth & Income Area (Weighting Range 30% to 40% with neutral being 35%)
Global Equity Sleeve: CWGIX, DEQAX & EADIX
Global Hybrid Sleeve: CAIBX, TEQIX & TIBAX
Domestic Equity Sleeve: ANCFX, FDSAX, INUTX & SVAAX
Domestic Hybrid Sleeve: ABALX, AMECX, DDIAX, FBLAX, FRINX, HWIAX & LABFX
Growth Area (Weighting Range 10% to 20% with neutral weighting being 15%)
Global Sleeve: ANWPX, SMCWX & THOAX
Large/Mid Cap Sleeve: AGTHX, BWLAX & SPECX
Small/Mid Cap Sleeve: PCVAX, PMDAX & TSVAX
Specialty & Theme Sleeve: LPEFX, PGUAX & NEWFX
Spiff Sleeve: VADAX
Total Number of Mutual Fund Positions = 48

@golub1: There is nothing wrong with ETFs, the secret is to have the discipline not to trade them. For your information, here is the Ben Carlson article I linked eariler this morning.
Regards,
Ted
http://www.mutualfundobserver.com/discuss/discussion/32520/ben-carlson-when-an-etf-changes-its-stripes#latest

I know that David has expressed his distaste for ETF's, but I either don't remember his reasons or maybe he didn't mention them. Here though are some concerns that can impact the selection of ETF's.
http://awealthofcommonsense.com/2017/04/when-an-etf-changes-its-stripes/

Here three other funds I like:
ARTRX, IWIRX, and MGGPX
These funds are small, ARTRX is the biggest at 2.1B, a quality that matters a lot to me. MGGPX is NTF, load-waived at Schwab and TDA. These are global, not purely international. For the latter, as stated above, FMIJX is the best bet.

FYI: In April of every year, we see dozens of articles urging us to sell in May and go away. In its basic form, you sell stocks on May 1, and you buy them back on Nov. 1. The strategy is credited to the respected Yale Hirsch of the Stock Trader’s Almanac, who began covering it in 1986.
Regards,
Ted
http://www.etf.com/sections/features-and-news/should-you-sell-may-go-away?nopaging=1
CXO Advisory May Trading Calendar:
https://www.cxoadvisory.com/trading-calendar/may/

GGSYX is one of the only two Grandeur Peak funds still open. It's the global version and GISYX is the international only fund. You won't find any giants here and if you're willing to accept 17.6% exposure to emerging markets then it might be interesting.

I've recommended this one before. PRIDX. 224 holdings, so it might not make it through your filters. Here's a link to the full bundle of holdings in a .pdf file, as of 31st March, 2017:
https://individual.troweprice.com/staticFiles/gcFiles/pdf/phidfq1.pdf:
Geographical breakdown:
Japan 21.8%
United Kingdom 12.8%
China 8.4%
Germany 4.4%
India 4.2%
South Korea 3.9%
Spain 3.7%
Italy 3.5%
France 3.5%
Sweden 3.4%
Performance and other stuff:
http://quotes.wsj.com/mutualfund/PRIDX?mod=DNH_S_cq
$59.12 share price on 18th April, 2017 is a 52-week high.

Hello @ep1,
THOAX ... Thornburg Global Opportunities Fund is a focus fund that I have owned for better than five years and seeks investment opportunity worldwide holding somewhere between 30 to 40 stocks. It is split about evenly between domestic and foreign and although it has owned small caps form time-to-time it is now more of a large/mid cap fund when it comes to style orientation. It is currently a five star bronze rate fund by Morningstar and has a top of class performance for 1, 3, 5 & 10 year periods (top 20% and better).
I have provided a link to both its fact sheet and Morningstar report below.
https://www.thornburg.com/products-performance/mutual-funds/overview.aspx?id=FGO
http://www.morningstar.com/funds/XNAS/THOAX/quote.html
The other two funds that are members of my global growth sleeve where THOAX is found are ANWPX and SMCWX.

I am not an index fan myself. So I'll offer two ideas ...
VMVFX ... yeah it's got 300ish holdings but it's about 50-50 US/international, skews midcap, and doesn't have the "usual suspects" in the top 10 places. And cheap at IIRC .30 ER or less. It's become my preferred place to park money in the equity markets that's not otherwise assigned.
BRLIX ... a .15 ER with 35 quantitatively-selected holdings that offers an equal-weighted collection of MEGA CAP companies. Even if they're mostly US based they do business all over the world. If I wanted basic market exposure that in some way 'touches' the world with its products I'd use that versus something that tracks an index or (gasp!) a market-weighted index.

I'm looking for a unique global or international equity fund...one that doesn't have the standard top 10 largest companies from each geography. Any recommendations? I'd also like to avoid funds that have hundreds of holdings (i.e. Fidelity funds). Thanks all!

FYI:
Regards,
Ted
http://video.cnbc.com/gallery/?video=3000610867&play=1