E*TRADE Financial has added 124 no-load no-transaction fee mutual funds from Vanguard Group to its platform.
E*TRADE does not compete with Vanguard, the way Charles Schwab, Fidelity Investments and TD Ameritrade does, because it doesn’t not have an asset management or defined contribution plan business, Sean McDermott, senior analyst at Corporate Insight, explained.
Additionally, the firm has a small presence in the registered investment adviser custody world, according to McDermott. The firm may be trying to grab assets through a Custody Advantage list offered by its subsidiary Trust Company of America. TCA has recently increased the number of discounted ETFs offered to advisers (FA, 9/18).
“E*TRADE can use this association with Vanguard to demonstrate that it is sensitive to customer demand for low-cost, index-based investments,” McDermott added.