LPL cuts ticket charge for some ETFs on key RIA platforms

Transaction charges for three ETF managers will drop 45%

May 30, 2019 @ 2:51 pm

By Bruce Kelly

LPL Financial said on Thursday it was making another move to attract assets by cutting transaction charges on exchange-traded funds on two key advisory platforms for advisers from $9.00 to $4.95.

The new pricing will go into effect in the second half of the year.

The 45% cut in ETF ticket charges are for advisers who use two proprietary LPL advisory platforms: Strategic Asset Management (SAM), and Strategic Wealth Management (SWM).

The cut in transaction charges for ETFs on LPL's platforms are for those offered by State Street, Invesco and WisdomTree, the company said in a statement. LPL is pursuing similar changes with other ETF managers.

When broker-dealers cut fees on transactions, it can turn into a boon for advisers, who can either pocket the difference or pass along the savings to clients.

LPL is the largest independent broker-dealer, with more than 16,000 independent contractor registered reps and advisers. Its price cut for ETFs comes as competitors in the business to custody registered investment adviser assets have also cut fees and moved to offer commission-free ETF trading.

In February, Charles Schwab Corp. and Fidelity Investments said that they were each expanding to more than 500 the number of commission-free ETFs on their respective platforms. Meanwhile, TD Ameritrade in June is expanding its commission-free ETFs to 569, almost double what it currently offers.

LPL is focused on recruiting, and the reduction in charges on ETF fees on its corporate SAM and SWM platforms could make it more attractive to advisers. Some LPL advisers over the years have also questioned the pricing of certain mutual fund transactions, with trades of some funds more expensive than others.

"What you are seeing is us expanding our appeal across a broader market," said Rob Pettman, LPL executive vice president, products and platforms in an email. "Our focus is on enhancing our advisory platforms overall and giving advisers the ability to choose which platform will work best for their clients and their business model. We think it's important to offer competitive platforms across affiliation models."

LPL in January said it was reducing fees for advisers with $25 million to $50 million in assets held in custody on the proprietary SAM platform to a flat eight basis point administrative fee.

0
Comments

What do you think?

View comments

Most watched

INTV

Young advisers envision a radically different business in five years

Fintech and sustainable investing are two factors being watched closely by some of the 2019 class of InvestmentNews' 40 Under 40.

INTV

Young professionals see lots of opportunity to reinvent the advice experience

Members of the 2019 InvestmentNews class of 40 Under 40 have strategies to overcome the challenges of being young in a mature industry.

Latest news & opinion

New Jersey fiduciary rule: Pressure leads to public hearing, comment deadline extension

Industry push results in chance to air grievances on July 17 and another month to present objections.

InvestmentNews' 2019 class of 40 Under 40

Our 40 Under 40 project, now in its sixth year, highlights young talent in the financial advice industry. These individuals illustrate the tremendous potential of those coming up in the profession. These stories will surprise, entertain, educate and inspire.

Galvin to propose fiduciary rule for Massachusetts brokers

The secretary of the commonwealth is proposing a fiduciary standard in response to an SEC investment-advice rule he views as too weak.

Summer reading recommendations from financial advisers

Here are some books that will keep you informed and entertained during summer's downtime

4 strategies for Roth conversions

There's never been a better time to do a Roth conversion, and here are several ways to go about it.

X

Hi! Glad you're here and we hope you like all the great work we do here at InvestmentNews. But what we do is expensive and is funded in part by our sponsors. So won't you show our sponsors a little love by whitelisting investmentnews.com? It'll help us continue to serve you.

Yes, show me how to whitelist investmentnews.com

Ad blocker detected. Please whitelist us or give premium a try.

X

Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print