Commissions? Nope.

A few months ago I mentioned that I was going to begin using more “Exchange Traded Funds” or ETFs for our managed accounts. These investments work like mutual funds, each share representing a basket of underlying stocks or bonds. But the internal costs of ETFs offer large savings over traditional mutual funds.

Offsetting these savings are $24 “ticket charges” that appear as commission on your confirmations of buys and sells. These are not true commissions, but rather are charges imposed by National Financial, the account custodian. I receive no part of them.

In 1994 when I started managing money for clients, I absorbed the cost of these ticket charges. After my business had grown some, I found myseP hesitating to do trades because a single transaction could cost me $1,000 or more out of my pocket for ticket charges.

Your interests are best served if I can make my decisions with the least conflict of interest. It is not good for you if I hesitate to move your money out of harm’s way because protecting you will cost me a chunk.

Passing these costs through to you while offsetting them with lower fund expenses does provide the best level of efficiency for your account, so that is why I am doing it.