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Portfolio > ETFs

Fidelity Expands Commission-Free ETF Platform

By Bernice Napach

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A Fidelity sign A Fidelity sign (Photo: AP)

Fidelity Investments has added ETFs from 11 more asset managers to its commission-free ETF platform, bringing the total number of funds to 503.

That’s within the ballpark of the number of funds on Schwab’s commission-free ETF platform, currently 514, and TD Ameritrade’s, 569, but far less than the nearly 1,800 ETFs on Vanguard’s no-transaction fee ETF platform for online trades only.

Fidelity announced the expansion of the commission-free ETF platform in February but  identified only the addition of 89 of BlackRock’s iShares funds to the platform, effective Feb. 28. It subsequently announced the addition of three Fidelity multi-factor ETFs, also effective on Feb. 28.

Now ETFs from these asset managers have been added to the platform: American Century, First Trust, Franklin Templeton, Goldman Sachs Asset Management, Invesco, Janus Henderson, John Hancock Investments, J.P. Morgan Asset Management, Legg Mason Global Asset Management, Pimco and State Street Global Advisors SPDR ETFs.

Anthony Rochte, head of Fidelity Institutional’s investments and technology group, said the expanded commission-free ETF platform “will make it even easier for investors and advisors to help build the right portfolios for their needs.”

Todd Rosenbluth, senior director of ETF and mutual fund research at CFRA, says the expansion of commission-free ETF platforms at Fidelity, Schwab and TD Ameritrade is particularly helpful “for advisors tactically building ETF portfolios. They now have wider array of choices to consider without having to incur undue trading costs.”

So do individual investors who are also very cost-conscious. According to a recent Schwab survey of 1,500 individual investors, close to 60% rated total costs, including commissions, as “extremely important” when evaluating ETFs. A similar percentage rated a broad selection of ETF categories as “extremely important” when evaluating brokerages that offer commission-free ETFs.

Fidelity’s commission-free ETF platform represents 69 Morningstar categories and includes passive, active and smart beta ETFs. Almost 95% of the ETFs are non-Fidelity ETFs, and the average expense ratio of ETFs on the platform is 36 basis points.

Fidelity serves more than 13,500 financial advisory firms investing client funds, 30 million individual investors and 22,000 businesses managing employee benefit programs. Total assets under administration as of April 30 were $7.6 trillion, including $2.7 trillion in managed assets.

— Related on ThinkAdvisor:

Bernice Napach

@Think_Napach

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