Restricted Mutual Funds

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Topic Author
Leesbro63
Posts: 10640
Joined: Mon Nov 08, 2010 3:36 pm

Restricted Mutual Funds

Post by Leesbro63 »

I hope I am titling this correctly for what I want to ask. Years ago, my father opened a brokerage account "with a golf buddy" that is currently worth about $62,000. It's with a full service brokerage. I am now the POA on the account and I'd like to consolidate the assets to Schwab if possible. The truth is the broker would love to get rid of us, as he makes no money and it's a small account. He admitted as much. I know that years ago, the assets were unique to this brokerage and could not be transferred. They use Pershing as their clearing house. There are three funds in this account:

Putnam Managed Municipal Income Trust, Symbol: PMM
Putnam Municipal Opportunities Trust, Symbol: PMO
Western Asset Municipal High Income Fund, Symbol: MHF

Can these funds be transferred to Schwab? The capital gains on the account are minimal....it might just make sense to let the broker get his $300ish commission per trade ($1000+ total commission on a $62,000 account) and liquidate. What do you think?
Nummerkins
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Joined: Tue Jun 01, 2010 4:41 pm

Re: Restricted Mutual Funds

Post by Nummerkins »

Ask Schwab -- don't throw money away.
Today's high is tomorrow's low.
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TomatoTomahto
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Joined: Mon Apr 11, 2011 1:48 pm

Re: Restricted Mutual Funds

Post by TomatoTomahto »

Leesbro63 wrote: Sun Jun 13, 2021 7:34 am it might just make sense to let the broker get his $300ish commission per trade ($1000+ total commission on a $62,000 account) and liquidate. What do you think?
If the broker would truly like for you to leave, they might be willing to discount the commissions, perhaps even waive them fully.
I get the FI part but not the RE part of FIRE.
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retired@50
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Joined: Tue Oct 01, 2019 2:36 pm
Location: Living in the U.S.A.

Re: Restricted Mutual Funds

Post by retired@50 »

$300 commission per trade...???

Have we used the way-back machine to arrive in 1972.

As others have stated, I'd spend a little time finding out if they could be consolidated for free at your current (presumably low-fee) broker.

Regards,
If liberty means anything at all it means the right to tell people what they do not want to hear. -George Orwell
DetroitRick
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Joined: Wed Mar 23, 2016 9:28 am
Location: SE Michigan

Re: Restricted Mutual Funds

Post by DetroitRick »

Those 3 funds are all simply closed-end funds (and NOT mutual funds or etf's). All 3 are NYSE listed, and can be bought and sold at Schwab. In fact, Schwab prepares and publishes fund reports on all 3, as they do for most closed-end funds.

When you get ready to open the Schwab account (they would then pull these positions from your current broker), you can readily have them check on the transfer ability just to be absolutely sure. You could even make a quick phone call to Schwab today to double check.

But I see nothing to suggest that they won't transfer as easy as any other closed end funds. Again, they are NYSE listed. Then you can make portfolio changes whenever you want after transfer and, even with your minimal capital gains, manage the tax consequences as needed. This will allow you to assess their long-term suitability and current discount/premium levels. And Schwab's $0 commission will beat the $300 - so personally I would not liquidate before transfer.

Edited to add: I concentrated on Schwab because you mentioned interest there (and I have most of my stuff there). But your experience should be similar at other major brokers too of course.
Topic Author
Leesbro63
Posts: 10640
Joined: Mon Nov 08, 2010 3:36 pm

Re: Restricted Mutual Funds

Post by Leesbro63 »

Update: The funds transferred to Schwab without problem. :D
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