As a passive investor I trade exclusively in Vanguard mutual funds and ETFs. Therefore, Vanguard is my primary brokerage account. I love it for it's commission free trades on Vanguard ETFs and mutual funds.
However, they are very limited in types of orders that can be placed (For e.g. it is not possible to place a Trailing Stop order). Secondly, not Vanguard funds and ETFs trade with a commission of $20.0 per trade (I do get 25 trades per year with a commission of $7.0). None of these matter while trading Vanguard index funds.
In additional to my passive portfolio I also own few individual stocks. Obviously Vanguard is not most suitable for my day to day trading activities. So, I have an additional account in Scottrade.
Back in 2011, Scottrade used to charge $6.99 per trade and TD Ameritrade $9.99 per trade. However, TD Ameritrade has excellent tools for investment and I would definitely consider it a better platform than Scottrade. In 2011 the extra $3.00 in commission was a big deal to me. I ended up opening an account in Scottrade. I dislike Scottrade's Flexible Reinvestment Plan (FRIP), it did not tie in well with my dividend reinvestment strategy.
TD Ameritrade bought Scottrade in an all cash deal. I am glad this happened as I feel TD Ameritrade is a much superior platform. One of the perks of investing via TD Ameritrade is access to commission free ETF (Scottrade and TD Ameritrade charge 6.95$ per trade).
I am a passive investor, investing in ETFs and mutual funds. Vanguard definitely has some of best and cheapest funds in these categories. But, I am open to investigating other fund houses to see what they offer. TD Ameritrade seems to offer a plethora of commission free ETFs. This post is a summary of my investigation of commission-free ETFs offered by TD Ameritrade.
Altogether TD Ameritrade offers about 296 commission free ETFs. These ETFs are spread around 8 fund families.
Some of these fund families I have heard of before. iShares has one of the best ETF selections. They are also almost as cheap as Vanguard. I believe iShares ETFs could be complimentary to my Vanguard ETFs. SPDRs are an equally awesome fund family. WisdomTree I have come across before, but found them to be expensive. The rest I have never heard or investigated.
The ETFs span about 5 categories. Equities, Sector, Bonds, International and Commodities. Further, there about 74 subcategories. There are even target allocation ETFs. Here are the top 10 sub categories with corresponding number of ETFs. Most of the ETFs offered are actively managed and seem to be Ex-US. They could definitely be considered complementary to my portfolio.
iShares has about 44 commission free ETFs on TD Ameritrade. Average expense ratio is 0.30% with a median expense ratio of 0.25%.
Top rated choices are:
iShares Edge MSCI USA Quality Factor ETF (QUAL)
-Large Blend, Distribution Yield (TTM): 1.75%
iShares Edge MSCI USA Momentum Factor ETF (MTUM)
-Large Growth, Distribution Yield (TTM): 1.09%
iShares Agency Bond ETF (AGZ)
-Short Government, Distribution Yield (TTM): 1.43%
First Trust has 61 commission free ETFs on TD Ameritrade. Average expense ratio is 0.75% with a median expense ratio of 0.67%.
Top rated choices are:
First Trust Dow Jones Internet Index Fund (FDN)
-Technology, Yield (TTM): No Regular Dividends
First Trust North American Energy Infrastructure Fund (EMLP)
-Energy Limited Partnership, Yield (TTM): 3.94%
First Trust Materials AlphaDEX® Fund (FXZ)
- Natural Resources, Distribution Yield (TTM): 1.12%
First Trust Preferred Securities and Income ETF (FPE)
- Preferred Stock, Distribution Yield (TTM): 5.42%
First Trust Low Duration Opportunities ETF (LMBS)
- Short-Term Bond, Distribution Yield (TTM): 2.73%
First Trust Managed Municipal ETF (FMB)
-Muni National Interm, Distribution Yield (TTM): 2.49%
JPMorgan has 5 commission free ETFs on TD Ameritrade. Average expense ratio is 0.47% with a median expense ratio of 0.40%.
Top rated choices are:
JPMorgan Diversified Return Global Equity ETF (JPGE)
- World Large Stock, Distribution Yield (TTM): 1.81%
PowerShares has about 27 commission free ETFs on TD Ameritrade. Average expense ratio is 0.49% with a median expense ratio of 0.39%.
Top rated choices are:
PowerShares S&P SmallCap Low Volatility Portfolio(XSLV)
- Small-Cap Value, Distribution Yield (TTM): 1.88%
PowerShares International BuyBack Achievers™ Portfolio (IPKW)
- Foreign Large Blend, Distribution Yield (TTM): 1.03%
PowerShares S&P MidCap Low Volatility Portfolio(XMLV)
- Mid-Cap Value, Distribution Yield (TTM): 1.47%
ProShares has 9 commission free ETFs on TD Ameritrade. Average expense ratio is 0.93% with a median expense ratio of 0.75%.
Top rated choices are:
ProShares RAFI® Long/Short (RALS)
-Market Neutral, Distribution Yield (TTM): 1.54%
ProShares Merger ETF (MRGR)
-Market Neutral, Distribution Yield (TTM): 0.86%
ProShares Hedge Replication ETF (HDG)
-Multialternative, Distribution Yield (TTM): No Regular Dividends
ProShares Morningstar Alternatives Solution ETF (ALTS)
-Multialternative, Distribution Yield (TTM): 3.53%
QuantShares has 4 commission-free ETFs on TD Ameritrade. Average expense ratio is 0.75% with a median expense ratio of 0.75%.
Top rated choices are:
AGFiQ U.S. Market Neutral Value Fund (CHEP)
- Market Neutral, Yield (TTM): No Regular Dividends
There are 71 commission-free WisdomTree ETFs on TD Ameritrade. Average expense ratio is 0.45% with a median expense ratio of 0.48%.
Top rated choices are:
WisdomTree International Hedged Quality Dividend Growth Fund (IHDG)
-Foreign Large Growth, Distribution Yield (TTM): 1.28%
WisdomTree Middle East Dividend Fund (GULF)
-Miscellaneous Region, Distribution Yield (TTM): 2.21%
WisdomTree MidCap Earnings Fund (EZM)
-Mid-Cap Blend, Distribution Yield (TTM): 1.14%
WisdomTree SmallCap Earnings Fund (EES)
-Small Blend, Distribution Yield (TTM): 0.93%
WisdomTree U.S. MidCap Dividend Fund (DON)
-Mid-Cap Value, Distribution Yield (TTM): 2.25%
WisdomTree Europe SmallCap Dividend Fund (DFE)
- Europe Stock, Distribution Yield (TTM): 2.52%
There are 74 commission-free SPDR State Street Global Advisors ETFs on TD Ameritrade. Average expense ratio is 0.28% with a median expense ratio of 0.26%. SPDR has some of the best ETFs available.
Top rated choices are:
SPDR® S&P Health Care Equipment ETF (XHE)
-Health, Distribution Yield (TTM): 0.03%
SPDR® S&P Aerospace & Defense ETF (XAR)
-Industrials, Distribution Yield (TTM): 0.76%
SPDR® MFS Systematic Value Equity ETF (SYV)
-Large Value, Distribution Yield (TTM): 1.48%
SPDR® MFS Systematic Core Equity ETF (SYE)
-Large Value, Distribution Yield (TTM): 1.21%
SPDR® S&P 600 Small Cap Value ETF (SLYV)
-Small Value, Distribution Yield (TTM)1.57%
The objective of this post was to provide exposure to commission-free ETFs available on TD Ameritrade. I do not recommend buying/selling or holding any of these ETFs.
For a full list of commision free ETFs, please check out tdameritrade .
Nice summary Mr. Geek. I am a Vanguard fan as well. I have dabbled in some of these other ETFs/ETF providers, but also seem to find my way back to Vanguard for the lost cost, no frills down the middle approach. Tom
ReplyDeleteAgree mate. But, not everyone has a Vanugard account. The SPDR funds are really good and as competitive as Vanguard. So, if you have a TD account it might be useful to by SPDR ETFs.
DeleteI use Scotia iTrade . It costs about $25 for trades. But some ETFs are commission free. Not a great selection, but I don't want to pay $25 per trade, till I have a $25,000 assets in the account.
ReplyDeleteI have heard about Scotia iTrade. 25$ per trade is crazy! Good to know you can get away with fees after 25k. Vanguard commissions comes down to $7 after 50,000 in assets.
DeleteThis is an awesome resource for someone starting out in ETF investing. I love transaction free ETFs.
ReplyDeleteThough, recently TD Ameritrade made some changes to their list of free ETFs as I saw an email from them. I think they took out some of the vanguard funds like VYM from the list. Fidelity also made changes the past year to their offering.
Fidelity and few other big brokerages are pushing their own funds these days over vanguard.
In any case, these comm free ETFs are a great way to dollar-cost average.
Thanks Mr. ATM. Pretty much. I have a Vanguard brokerage account. All Vanguard ETFs trade for free. TD Ameritrade has an excellent choice of SPDR ETFs. They are comparable to Vanguard (if not better).
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