TD Ameritrade ETFs Removed from Platform
TD Ameritrade has announced that it will expand the number of exchange-traded funds (ETFs) offered to 296 and also remove some ETFs from its no-transaction-fee platform. The firm said that the Vanguard and iShares Core ETFs would no longer be available without a transaction fee, beginning November 20.
At first, the firm said the ETFs would be removed in 30 days, but industry criticism from several notable executives resulted in a change of course. Responding to the feedback from upset brokers, TD Ameritrade is instead tripling the amount of time it will allow advisers to continue trading Vanguard and iShares Core ETFs for free, pushing the new date to January 19, 2018. The decision comes just one week after the initial announcement.
Financial Advisers Upset About TD Ameritrade ETF Program
A number of securities professionals have been outspoken about TD Ameritrade’s announcement, including Michael Kitces, partner and director of research at Pinnacle Advisory Group and co-founder of the XY Planning Network. Kitces says that charging fees to trade the Vanguard and iShares Core ETFs would be hard on younger investors who regularly make smaller investments and would need to rebalance existing portfolios with new funds.
Though TD Ameritrade acknowledged negative feedback about the change, Tom Nally, president of TD Ameritrade Institutional, notes that critics are overlooking the advantages of other ETFs, such as State Street SPDR ETFs, that have been added to the TD’s platform.
“These are the lowest-cost broad index-tracking ETFs,” he said. “The domestic funds are 18% cheaper than Vanguard’s, and on the international front they are 33% cheaper than Vanguard’s, which we think will be attractive to advisers and their clients.”
TD Ameritrade ETF Commission-Free Offering Triples
Along with this announcement, TD Ameritrade expanded its commission-free ETF platform, nearly tripling the offerings from 100 to 296. Effective October 17, 2017, independent registered investment advisor (RIA) clients and individual investors now have access to one of the largest selections of commission-free ETFs in the industry, as well as the most non-proprietary, commission-free ETFs.
In a release circulated by the firm, the participating ETF providers are AGFiQ QuantShares, First Trust Portfolios, iShares ETFs, J.P. Morgan Asset Management, PowerShares (Invesco), ProShares, State Street Global Advisors and WisdomTree.
The expanded program includes ETFs that cover 77 Morningstar categories and include extremely low-cost ETFs in 15 core investment strategies. TD Ameritrade began offering commission-free trading in ETFs in 2010.
ETFs Often Misunderstood by Stockbrokers
There have been several controversies related to retail investments in ETFs. The Financial Industry Regulatory Authority Inc. (FINRA) recently ordered Wells Fargo to pay more than $3.4 million in restitution to customers affected by unsuitable recommendations of volatility-linked ETFs.
FINRA has found a lack of supervision and broker misunderstanding to be leading causes of ETF investor losses.
In related TD Ameritrade news, Dimond Kaplan &Rothstein, P.A. is pursuing FINRA arbitration claims against TD Ameritrade on behalf of an elderly investor who suffered stock option investment losses as a result of services rendered through third-party investment advisor Sheaff Brock.
The TD Ameritrade customer got to Sheaff Brock through TD Ameritrade’s AdvisorDirect program and suffered significant losses in a risky put income options strategy.
Did You Lose Money as a Result of TD Ameritrade ETFs?
If you believe you have lost money in ETFs trades, you may have certain legal rights that require your immediate attention.
Call an Investment Fraud Attorney Today
If you are looking for an investment fraud attorney to review your rights and options, the investment fraud lawyers at Dimond Kaplan & Rothstein, P.A. have recovered more than $100 million from banks and brokerage firms for their wrongful actions.