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Approfondimenti

Master the Mechanics of ETF Trading – Prüfung (test)

  • Understanding ETF's creation/redemption process gives investors insight into additional liquidity they can access. 
  • Bid-ask spreads are determined by the bid-ask spread of the underlying securities, the liquidity of those securities, execution costs and market risk.

Testing

Becoming familiar with the ETF creation/redemption process is key to understanding the true extent of an ETF’s overall liquidity and achieving more efficient execution from a wider selections of funds. The creation and redemption process for ETFs takes place in the primary market and is facilitated by authorized participants (APs). APs are US-registered, self-clearing broker dealers who regulate the supply of ETF shares in the secondary market.1

 

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1 Source: Testing 

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