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3140.hk v VOO

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  1. #1

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    3140.hk v VOO

    Just thinking out aloud, so need to formulate thoughts on this.

    3140.hk is the Vanguard ETF for the S&P500 trading in Hong Kong in HKD. It's fees are 0.18% and is subject to 30% withholding on dividend profits. It however doesn't count to any US estate tax liability.

    VOO is the Vanguard ETF for the S&P500 trading in the US in USD. Its fees are 0.03% and is subject to 30% withholding on dividend profits. You will however be subject to estate duty after USD60k.

    I think, taking into account currency conversion fees direct with bank or broker, up to USD60k its much cheaper buying VOO over 3140.hk.

    Seeing as most HK banks do allow for US trading, it may be a better option than 3140.hk (up to USD60k if you care about US estate tax implications).

    Any thoughts?

    Kiran2285 likes this.

  2. #2

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    I think so.

    The 5x management fee difference will really eat into your returns, given that both are subject to 30% WHT.

    There are a number of commission free US stock-trading brokers (PM me I can send you the links), so you can effectively take out the commissions as well, and more to your bottom line.

    I just found out about the estate tax for USD60,000 and above assets, so thank you. I guess this would have to be carefully managed and diversified in due course. Maybe actively realizing gains and repatriating the funds out of the US?

    https://www.taxesforexpats.com/artic...ed-states.html

    pin likes this.

  3. #3

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    Quote Originally Posted by muzzdang:
    I think so.

    The 5x management fee difference will really eat into your returns, given that both are subject to 30% WHT.

    There are a number of commission free US stock-trading brokers (PM me I can send you the links), so you can effectively take out the commissions as well, and more to your bottom line.

    I just found out about the estate tax for USD60,000 and above assets, so thank you. I guess this would have to be carefully managed and diversified in due course. Maybe actively realizing gains and repatriating the funds out of the US?

    https://www.taxesforexpats.com/artic...ed-states.html
    Thanks for that. Aware of the various commission free brokers (such as sofi), but I think a lot of people prefer to invest via banks in HK . For sure, if you go commission free, its much cheaper (but added risk).

  4. #4

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    I am using FirstTrade, situated in the US, so far so good. It allows for non-US investors (including Hong Kong) and you can also apply for their Visa Debit Card once you open your account.

    There is currently a promotion where they will refund your wire fees, so you could check them out.

    https://www.firstrade.com/content/en-us/international

    https://www.firstrade.com/content/en-us/accounts/cma/


  5. #5

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    If this is a long term hold.. Buy the UK equivalent etf.

    The 30% starts adding up. I will try and dig up my calculations where it turned out UK was cheaper for s&p and us was cheaper for qqq.

    Kowloon72 likes this.

  6. #6

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    Quote Originally Posted by shri:
    If this is a long term hold.. Buy the UK equivalent etf.

    The 30% starts adding up. I will try and dig up my calculations where it turned out UK was cheaper for s&p and us was cheaper for qqq.
    Yes, agreed, but in terms of opening a brokerage account which trades UK shares, that is much harder. I'm trying to go for what is the quick and easy option.

  7. #7

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    Dbs? The trade is not cheap.. But no costs after that. (no UK stamp duty on etfs)

    In general I don't care too much about 1 time transaction fees or the round trip for long hold / buy.


  8. #8

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    Quote Originally Posted by shri:
    Dbs? The trade is not cheap.. But no costs after that. (no UK stamp duty on etfs)

    In general I don't care too much about 1 time transaction fees or the round trip for long hold / buy.
    You need HKD1M to access UK trading.

    Also there are quarterly custody fees with them.

    Again this is for people who are trying to start out and to keep it easy and simple. Different ball game once you go over USD50k, then you should be considering other options. But up to USD50k I think VOO may be a better option than 3140.HK.

  9. #9

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    Lower cost - Saxo / IB


  10. #10

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    Quote Originally Posted by shri:
    Lower cost - Saxo / IB
    Saxo has custody fees.

    IB unless you have usd100k you have to pay, but yes it's an option.

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