The Vanguard Group Inc.'s new mutual fund trading restrictions will likely "open the floodgates" to other fund companies following in Vanguard's footsteps, Rick Meigs, founder of 401khelpcenter.com, predicts.
"Anytime you see Fidelity and Vanguard do something, others will jump on board," said Mr. Meigs, whose Portland, Ore., company provides information on defined contribution issues.
But he's not sure the other companies' policies will be as strict.
Beginning Sept. 30, Vanguard investors will not be allowed to buy shares of a Vanguard fund by phone or online within 60 days of selling shares in the same fund. Vanguard, in Malvern, Pa., currently allows investors to make unlimited roundtrips between funds, as long as it does not deem the trades large enough to have a negative impact on managing the funds.
Vanguard has one of the most restrictive policies of the fund companies that imposed restrictions following the mutual fund trading investigations by New York Attorney General Eliot Spitzer and the U.S. Securities and Exchange Commission.