Hi Bernie,
I do my UOPIX with Profunds. I prefer Profunds because you can call in a trade with them later in the day than with any broker I'm aware of. In addition, once you are in their queue prior to the Profunds cut-off time, you can hold on and they will take your trade regardless of what time it is when they reach you (or at least that's the way it used to be).
With a discount broker, you can switch the cash from sales of UOPIX to something better than a mere money market, but that has its downside as well. For example, if you have to switch out of the bond fund where you parked money too often or before a minimum period has expired, the broker could impose penalties or, in the case of a closed end fund, you pay commissions. In addition, if there is a mismatch in settlement dates, you may have to put up additional money to support the trade. Finally, the relatively small increase in income over a money market obtained by switching from UOPIX into a short or intermediate term bond fund at a broker is not as much as what I've saved by making a timely trade or two directly with Profunds.
On balance, I therefore prefer to trade with Profunds, but that's my bias and rationale. Others may find that a discount broker suits them better, especially if the broker permits a lower minimum account balance than Profunds. Now, if Tom can talk Profunds into allowing GTC orders, we wouldn't even be having this conversation <g>.
Hope that helps.
SAS... (mile.high.foothills.com) |
