At a time when Schwab, Fidelity and other firms have eliminated fees on ETFs, LPL is introducing its own no-transaction-fee ETF network.
LPL will offer more than 450 passive and smart beta funds from State Street Global Advisors, Invesco and WisdomTree on its Strategic Asset Management and Strategic Wealth Management platforms, designed for corporate RIA, hybrid RIA or RIA-only advisors, beginning Friday.
Advisors will “have access to a compelling, competitively priced selection of ETFs to choose from to suit their clients’ needs,” said Rob Pettman, executive vice president, Investor and Investment Solutions, LPL Financial, in a statement.
“We understand the importance of partnering with firms to provide greater ETF accessibility,” said Jarrett Lilien, the president and chief operating officer of WisdomTree, in a statement.
LPL’s move is part of a broader firm strategy to cut prices and increase the value of its platforms. In recent years, it has eliminated IRA custodial fees and cut its overall program fee for Model Wealth Portfolios by roughly one-third, among other fee cuts.
“We will continue to invest in platforms as well as the technology and service experience to do more than lower costs, but create value with advisors,” said Pettman.
LPL’s introduction of no-fee ETFs “helps to better even the advisory playing field,” but it doesn’t eliminate all ETF fees, said Todd Rosenbluth, director of ETF and mutual fund research at CFRA.
ETFs have expense ratios, and buying and bid/ask spreads when bought or sold. Advisors also need to consider whether a particular ETF is appropriate for individual clients and whether even cheaper alternatives that offer clients better exposure to a particular market are available, said Rosenbluth.
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