TD Ameritrade Waives Fees on 569 ETFs


The ETF fee/price wars are heating up.

Hot on the heels of a recent announcement by Vanguard to lower ETF prices via fee cuts for select ETFs it offers, rival TD Ameritrade announced it was expanding its commission-free ETF trading program. Now clients can save money trading 569 funds, up from 300, coming from 21 providers covering some 90 Morningstar categories.

Just  week ago, in a bid to bring more investors to the ETF space, Vanguard announced that it cut prices on 21 of its ultra-low-cost funds, including eight of its ten largest ETFs.

The mega issuer of ETFs slashed prices on some of the largest ETFs on the market today, including the $114 billion Vanguard Total Stock Market ETF (VTI) and the $112 billion Vanguard S&P 500 ETF (VOO), the third and fourth largest funds, respectively. VTI and VOO now each cost 0.03%, down from 0.04% apiece.

Other notable price drops include the $72 billion Vanguard FTSE Developed Markets ETF (VEA), whose expense ratio went from 0.07% to 0.05%; and the $66 billion Vanguard FTSE Emerging Markets ETF (VWO), whose expenses dropped from 0.14% to 0.12%.

The move was designed to make the issuer more competitive with others such as SchwabState Street and J.P. Morgan.

TD’s move, effective June 1, 2019, gives more than 7,000 registered investment advisors (RIAs) and TD Ameritrade’s 11 million individual investor client accounts access to one of the largest and most diverse selections of non-proprietary, commission-free ETFs in the industry.

ETFs from 12 new providers join TD Ameritrade’s expanded line up, which covers an additional 13 Morningstar categories and offers more choices for those already represented in TD Ameritrade’s commission-free ETF program.

Along with more municipals, commodities, index-tracking, countries, single currency, sector, asset allocation and low-cost core offerings, advisors and investors can access actively managed ETFs utilizing long-short smart beta and environmental social governance (ESG) strategies. RIAs and individual investors will be able to choose ETFs from the following providers:

Aberdeen Standard Investments* IndexIQ Advisors* Principal*
AGFiQ QuantShares Invesco ProShares
DWS* iShares ETFs State Street Global Advisors
First Trust Portfolios John Hancock Investments* USAA
FlexShares * J.P. Morgan Asset Management USCF Investments*
Global X Management* Nuveen* VanEck*
Goldman Sachs Asset Management* PIMCO* WisdomTree

*New providers as of June 1, 2019

“While we’re pleased to again offer our clients a greater selection of commission-free ETFs, we’re particularly excited about the broad range of strategies, sectors and asset classes available without a commission,” said Eileen Norton, director of investment solutions at TD Ameritrade Institutional told Traders Magazine. “It doesn’t end here. We’ll continue to innovate and upgrade the ETF Market Center and commission-free program going forward as part of our constant efforts to improve the investing experience for our clients.”

Industry-wide, the U.S. ETF market surged to $3.4 trillion across 1,996 ETFs at the end of 2018, a more than tenfold increase from $237 billion across 157 ETFs in 2004, according to research firm ETFGI.

Related articles

  1. Investors are seeking the tax efficiency, trading flexibility and cost benefits of ETFs.

  2. The initial product will offer investors exposure to Bitcoin.

  3. This helps to minimize the risk level and protect market participants from compliance breeches.

  4. ETFs in Europe had net outflows of $5.06bn in September.

  5. HKEX welcomed the regulatory announcement.