has stepped in with the biggest move yet in the exchange traded
. Not since
pioneered the idea of a mutual fund supermarket has something been
so appealing, especially for the retail investor.
Beginning today, 101 ETFs traded on TD Ameritrade's platform
will be commission-free. This is the largest offering of
commission-free ETFs the industry has seen to date, though it's not
the first. This year,
made its 47 ETFs commission-free on its platform, Schwab charges no
commission on its 11 ETFs when traded on their platform and
offers free trades on 25
5 Ways to Cut the Cost of ETF Investing.
There's a small catch with the free trades offered at TD
Ameritrade: to take advantage, you have to hold the ETF for 30
calendar days. If it's sold before then, TD Ameritrade's standard
$9.99 fee will be levied. [
Where You Can Go for Cheap ETF Trades.
But there's no doubt that this market is a game-changer for the
ETF industry in several ways:
1. TD Ameritrade's move means that Fidelity, Schwab and E-trade
will be encouraged to react in some way and come out with a
competing offer that's just as attractive. Assets in the ETF
industry are approaching $1 trillion, and TD Ameritrade has come
out strong saying, "We're worthy of grabbing your business."
2. Retail investors and advisors now have no reason to not use
ETFs in both large and small portfolios to achieve diversification
and to do
. Smaller investors may finally be encouraged to use ETFs now as a
Matt Krantz for USA Today points out
that most large online brokers that offer free ETF trades require a
$1,000 minimum to open an account. Other brokerages, such as Zecco,
Wells Fargo and Bank of America, require a $25,000 minimum to open
an account and qualify for a limited number of free trades. [
How to Start Buying and Trading ETFs.
3. It's one more shot across the bow for poor-performing mutual
funds. With TD Ameritrade's new offerings, there's even less reason
to remain invested in mutual funds.
iShares S&P500 Index Fund (NYSEArca: You can find a
complete list of all ETFs offered commission-free here.