Did TD Ameritrade Shoot Its’ Own Foot?

Recently, TD Ameritrade has nearly tripled the number of ETFs that it will allow customers to trade commission-free. On the surface this sounds great. But, in the process of attempting to expand their customer base they have neglected to consider the needs and desires of many of their existing customers. I have not yet formed a strong opinion on TD Ameritrade’s decision but I have gathered numerous articles about this move and the tone ranges from praise to utter disgust. Here are the articles currently available:

RIA Biz (i): TD Ameritrade angers RIAs who feel ‘blindsided’ after TD Ameritrade’s actions prompt the departure of all Vanguard and some iShares ETFs from its NTF platform ““There was no indication of changes coming, so it felt like we were all blindsided,” he says. “Unfortunately, every ETF I’ve been using was removed from the NTF list.”” October 18, 2017 — 1:45 PM AKDT by By Lisa Shidler

RIA Biz (ii): TD Ameritrade is ‘gathering feedback’ after Michael Kitces’s blogged overture for RIA collective bargaining on wholesale ETF line-up shift      “A disconsolate but not discouraged Michael Kitces has thrown all his energy into rallying RIAs and beseeching TD Ameritrade to rethink its decision to switch out 84% of the ETF choices it was offering free of ticket charges.” October 20, 2017 — 3:47 PM AKDT by Brooke Southall

ETF.com: TD Ameritrade Drops Major No-Fee ETFs  “It’s like the rug was pulled out from under us,” said Blair duQuesnay, CIO of ThirtyNorth Investments in New Orleans. “Every single Vanguard and iShares ETF we own is on the deletion list.” October 18, 2017 LARA CRIGGER

Investors Business Daily: SSGA Launches Ultra-Low-Cost ETFs; Ameritrade Takes On Schwab  “TD Ameritrade added new providers to its commission-free lineup, but omitted ETFs from Vanguard, which doesn’t pay brokers to offer its products. Vanguard funds will still be available through TD Ameritrade outside the commission-free program. This was first reported by the Wall Street Journal over the weekend.”  10/17/2017

Financial Planning: TD’s new ETF menu could send competitors scrambling  “TD’s move comes as the latest salvo in the ongoing fee wars in the ETF space, the “race to zero,” as asset managers and custodians look to undercut each other by slashing commissions.” By Kenneth Corbin  Published October 19 2017, 12:49pm EDT

Benzinga: TD Ameritrade Makes Major Splash In Commission-Free ETF Battle   “On Monday, brokerage giant TD Ameritrade Holding Corp.  AMTD announced a major expansion of its commission-free ETF platform, which will see the company triple the number of ETFs clients can trade without commission to 296 from 100. That means TD Ameritrade’s commission-free platform is now larger than Charles Schwab Corp SCHW. Schwab ETF OneSource platform, previously the biggest offering of ETFs on a commission-free basis.” Todd Shriber, ETF Professor , Benzinga Staff Writer October 17, 2017 10:19am 

The Motley Fool: Commission-Free ETFs: Not Always the Best Choice          “Why TD Ameritrade’s change is a big deal? TD Ameritrade was one of the last holdouts on monetizing commission-free ETFs. As it explained in its annual reports, it offered its clients “over 100 commission-free ETFs,” all of which were “selected by independent experts at Morningstar Associates, LLC.” Jordan Wathen (TMFValueMagnetOct 21, 2017 at 9:00AM

Forbes: TD Ameritrade Eliminated Low Cost Commission Free Exchange Traded Funds “TD Ameritrade deserves all of the customer complaints, corporate scorn, and industry derision aimed at them for making this decision and implementing it in this manner. They removed Vanguard funds from their lineup in exactly the same manner as other commission-based custodians such as Morgan Stanley, Ameriprise, and Wells Fargo. And they are giving investors mere weeks to sell their existing shares and purchase something in the new lineup. Starting November 21, 2017, most of the existing funds in the program will no longer be allowed to participate.” 10/19/2017 

Barron’s (i): TD Ameritrade Raising its ETF Game  “TD Ameritrade is overhauling its commission-free ETF trading platform, adding dozens of new funds and jettisoning all offerings from Vanguard. So reports The Wall Street Journal.” Oct. 16, 2017 11:24 a.m. ET

Barron’s (ii): TD Ameritrade: That’s An Enhancement?!?!  “TD Ameritrade just revamped its commission-free ETF trading platform, tripling products offered, but dropping Vanguard.” By Crystal Kim 

Disclosure: I own many ETFs; some of those funds may be mentioned in any of articles listed above. I am currently a customer of Scottrade which is in the process of being merged with TD Ameritrade.

Thank you for taking time to read this article. The Deep Value ETF Accumulator, aka Micah McDonald

 

 

 

 

 

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