SecProbe.io

January 6, 2012
 Via E-mail

Stephanie L. Brown Managing Director and General Counsel LPL Investment Holdings Inc. One Beacon Street Boston, MA  02108
Re: LPL Investment Holdings Inc.
 Form 10-K for the Fiscal Year Ended December 31, 2010
Filed March 9, 2011 Form 8-K Filed April 27, 2011 File No. 001-34963

Dear Ms. Brown:
 We have reviewed your filings and have the following comments.  In some of our
comments, we may ask you to provide us with  information so we may better understand your
disclosure.
 Please respond to this letter within te n business days by amending your filings, by
providing the requested information, or by advi sing us when you will provide the requested
response.  Where we have requested changes in  future filings, please include a draft of your
proposed disclosures that clearly identifies new or revised disclosu res.  If you do not believe our
comments apply to your facts and circumstances or  do not believe an amendment is appropriate,
please tell us why in your response.
 After reviewing any amendment to your f ilings and the information you provide in
response to these comments, we ma y have additional comments.
            Form 10-K for the Fiscal Year Ended December 31, 2010

 Item 1.  Business

 Our Financial Advisors, page 2

 1. We note that you disclose the compound annua l growth rate for your advisor base.
Please also disclose in this se ction the annual growth rate fo r the most recently completed
fiscal year.

Stephanie L. Brown LPL Investment Holdings Inc. January 6, 2012 Page 2

 Item 1A.  Risk Factors

 Regulatory developments and our failure to comply with regulations…, page 17

 2. In future filings, please expand this risk factor to specifically discuss any pending
legislation, rules or regul ations that could have a material effect on you.
 Our indebtedness could adversely aff ect our financial health…, page 20

 3. In future filings, please revise  this risk factor to specifi cally describe the effects your
indebtedness could have on you.  Among other things, the revised risk factor should
describe and quantify your debt service oblig ations, describe and quantify the effect of
one and two notch credit rating downgrades a nd describe the financial and restrictive
covenants contained in your debt agreements.
 Item 6.  Selected Financial Data, page 34

 4. It appears that you have iden tified Adjusted EBITDA, Adjusted Earnings, and Adjusted
Earnings per Share as non-GAAP on pages 41 and 43 of your filing, but these measures
are not clearly labeled as non- GAAP in each location where they  are used including here.
Please revise your disclosure in future filin gs, including your earnings releases furnished
in Forms 8-K, to clearly label these meas ures as non-GAAP wherever presented in the
filing, including when they are part of a fi nancial metric.  Refer to Item 10(e) of
Regulation S-K.
5. You disclose that the 2010 gross margin measure excludes $222 million in share-based
compensation to advisors related to the re striction on common stoc k that was released
upon closing of your IPO in the fourth qua rter of 2010.  As you are adjusting this
measure for the year ended December 31, 2010 to exclude these charges, it appears to be
a non-GAAP measure for that period.  Please revi se your disclosure in future filings to
change the label of this measure in 2010 to refl ect that it has been adjusted.  Also, revise
your disclosure to clearly labe l the 2010 adjusted gross margin  and adjusted gross margin
as a % of net revenue as non-GAAP.
 Item 7.  Management’s Discussion and Analys is of Financial Condition and Results of
Operations
 Our Operating Expenses

 Production Expenses, page 38

 6. You disclose here that you refer to y our production expenses, including brokerage,
clearing and exchange fees as production payout.   You also disclose on page 38 that you
adjusted your production payout measure for 2010 to exclude the $222 million in share-

Stephanie L. Brown LPL Investment Holdings Inc. January 6, 2012 Page 3

 based compensation charges triggered by your initial public offering.  You also provide
disclosure and discussion of a production pa yout percentage on page  49 for each period
presented.  Furthermore, your Form 10-Q fo r the Quarterly Period Ended September 30,
2011 provides definitions of production expe nses and production payout that appear
contradictory.  You disclose on page 27 of the Form 10-Q that you refer to production
expenses including brokerage, clearing, a nd exchange fees as production payout.
However, on page 39 of the Form 10-Q you disclose that yo ur production payout
includes all production expenses except broke rage, clearing and exchange expenses for
the three months ended September 30, 2011 and 2010.  In light of the adjustments to these measures and changes in their respect ive definitions between periods, please
address the following:
 Revise your disclosure in future filings to clearly and consistently define how you
calculate the production payout  measure and percentage metric that you disclose.

 Tell us and clearly disclose in future f ilings the extent to which you changed the
calculation during any of the periods pres ented.  Identify the date at which you
changed the definition, and discuss why you be lieved it was appropriate to make such
a change.
 Change the title of the adjusted produc tion payout measure and adjusted production
payout percentage for 2010 to refl ect the fact that it has been adjusted  to exclude the
$222 million in share-based compensation charges.
 Clearly label the adjusted production payout measure a nd percentage as non-GAAP
where used throughout the document a nd provide a reconciliation to the unadjusted
measures and percentages.

How We Evaluate Growth, page 39
 7. It appears that your “Rec urring revenues” measure re presents a non-GAAP measure
under Item 10(e) of Regulation S-K as it has been adjusted to exclude certain revenues
from your GAAP-based “Total net revenues.”  In future filings, please clearly label such
measures as non-GAAP.
 Liquidity Assessment, page 54

 8. We note your disclosure on pages 53 and 54 th at the majority of your working capital
requirements are primarily funded directly or indirectly by your advisors’ clients.  We
also note your disclosure on page F-31 that  you had received colla teral primarily in
connection with client margin  loans with a market value of approximately $326.9 million,
which you can sell or repledge, and of th is amount, approximately $167.4 million has
been pledged or sold as of December 31, 2010.  As your liquidity condition appears to be
dependent upon your ability to sell or repled ge client collateral, please revise your

Stephanie L. Brown LPL Investment Holdings Inc. January 6, 2012 Page 4

 disclosure in future filings to clarify the ex tent to which there are any restrictions in
certain jurisdictions or otherwise that lim it your ability to sell or repledge the $326.9
million of client collateral as of December 31, 2010.
 Item 8.  Financial Statements and Supplementary Data

 Notes to Consolidated Financial Statements

 2.  Summary of Significant Accounting Policies

 Receivables from and Payabl es to Client, page F-11

 9. We note your disclosure that you pay interest on certain client free credit balances held
pending investment.  Please revise your disclosure  in future filings to clarify the nature of
the amounts included in payables to client, including whether your entire payables to
client balance represents free credit balances  held pending investment in the short-term,
or whether this balance also includes your a dvisors’ client deposits that are held in
support of their on-going trading ac tivities as described on page 53.

Legal Reserves, page F-15
 10. We note your accounting policy that you cons ider many factors in determining your
reserves for legal proceedings, including likel y insurance coverage.  Please tell us and
revise your disclosure to clarify whether you report your reserves for legal proceedings
on a gross basis and related insurance recove ries on a gross basis in your statement of
financial condition, rather th an netting these amounts.
 21.  Selected Quarterly Financia l Data (Unaudited), page F-40

 11. We note your disclosure of gross margin excl udes a share-based compensation charge of
$222 million in the fourth quarter of 2010.  Th is appears to be a non-GAAP measure, and
as such, is not allowed to be presented in  the Notes to your C onsolidated Financial
Statements.  Please revise your disclosure in future filings to exclude this non-GAAP
measure from your quarterly financial data in cluded in the Notes, or tell us why you
believe this is not a non-GAAP measure.  Pleas e note that we believe an explanation of
this significant charge in the fourth quarter of 2010 in a foot note to the quarterly financial
data table would be appropriate.  Refer to  Item 10(e)(1)(ii)(C) of Regulation S-K.

Stephanie L. Brown LPL Investment Holdings Inc. January 6, 2012 Page 5

 Item 11.  Executive Compensation

 Definitive Proxy Statement on Schedule 14A

 Long-Term Equity Incentive Program, page 21

 12. In future filings, describe how the Comp ensation Committee determines the amount and
types of the equity awards.  We note that the awards are based on subjective judgment in
reviewing “several factors” and take into c onsideration levels of responsibility and past
and current contributions to the company.  However, your disclosure should be more
detailed and specific so an investor can understand how and why the awards are made.
 Summary Compensation Table, page 25

 13. Tell us why the cash amounts paid to your named executive officers pursuant to the
achievement of the metric targets are reporte d in the Bonus column instead of the Non-
equity Incentive Plan Compensation column.  As a related matter, tell us why no non-
equity incentive plan awards are shown in the Grants of Plan-Based Awards Table on
page 26.

Item 15.  Exhibits, Financial Statement Schedules

 14. You have omitted Exhibit A and Schedule 1 from Exhibit 4.3.  Please re-file the
Stockholders’ Agreement in its entirety.
 Form 8-K filed April 27, 2011

 15. Counsel may not state that the legality opini on may be used only in connection with the
offer and sale of the shares while the registra tion statement is in effect.  Please amend the
Form 8-K and file a legality opinion wit hout that qualification.  In addition, in the
opinion filed with the regi stration statement on Form S-3ASR (File Number 333-
173703), counsel may not assume that the co mpany is duly organized, validly existing
and in good standing.  Please file an amendmen t to the registration statement and include
a legality opinion without that assumption.

We urge all persons who are responsible for th e accuracy and adequacy of the disclosure
in the filing to be certain that the filing include s the information the Securities Exchange Act of
1934 and all applicable Exchange Act rules requir e.  Since the company and its management are
in possession of all facts relating to a company’s disclosure, they are responsible for the accuracy
and adequacy of the disclosures they have made.
 In responding to our comments, please provi de a written statement from the company
acknowledging that:

Stephanie L. Brown LPL Investment Holdings Inc. January 6, 2012 Page 6

  the company is responsible for the adequacy an d accuracy of the disclo sure in the filing;

 staff comments or changes to disclosure in response to staff comments do not foreclose
the Commission from taking any action with respect to the filing; and

 the company may not assert staff comments as  a defense in any proceeding initiated by
the Commission or any person under the federa l securities laws of  the United States.

You may contact Staci Shannon at (202)  551-3374 or Kevin W. Vaughn, Accounting
Branch Chief, at (202) 551-3494 if you have que stions regarding comments on the financial
statements and related matters.  Please contac t Michael Seaman at (202) 551-3366 or Sebastian
Gomez Abero at (202) 551-3578 with any other questions.

Sincerely,
   /s/ Sebastian Gomez Abero for
Suzanne Hayes Assistant Director