ETF's

[BlackCross]

Seems a pretty low key launch?
SMARTSHARES AND BLACKROCK LAUNCH EIGHT ETFS ON NZX

• EMERGING MARKETS EQUITIES ESG ETF (EMG)
  
• EUROPE EQUITIES ESG ETF (EUG)
  
• GLOBAL EQUITIES ESG ETF (ESG)
  
• JAPAN EQUITIES ESG ETF (JPN)
  
• US EQUITIES ESG ETF (USA)
  
• GLOBAL AGGREGATE BOND ETF (AGG)
  
• AUTOMATION AND ROBOTICS ETF(BOT)
  
• HEALTHCARE INNOVATION ETF (LIV)

[BeeBop]

I have been hearing about it....NZX now being the list of ETFs...is it that they have only had one new company listing this year....got to rescue it with something even if it is a bunch of tracker funds.

[arekaywhy]

This is likely a fundamental trading question...why does it appear that there are single, large buy and sell trades, very close to each other, on all of these ETFs when looking at the depth of trade? It almost looks like "goal posts" around the current trade price. Almost as if to control the share price of the stock.

[blackcap]

This is likely a fundamental trading question...why does it appear that there are single, large buy and sell trades, very close to each other, on all of these ETFs when looking at the depth of trade? It almost looks like "goal posts" around the current trade price. Almost as if to control the share price of the stock.

Hi arekaywy, these bid and offers are provided by the "market maker". They are "invited" by the ETF to provide liquidity for the product. They help us the investor by giving us the ability to purchase and sell at pretty much market price. They make their money on the spread.

[arekaywhy]

Thanks blackcap, so it seems like they are controlling the market to me. If someone comes along with anything less than 50 grand to buy or sell, you get that price and don't get to take advantage of an actively moving market. I understand the idea of providing liquidity, however, this seems dodgy somehow

[blackcap]

Thanks blackcap, so it seems like they are controlling the market to me. If someone comes along with anything less than 50 grand to buy or sell, you get that price and don't get to take advantage of an actively moving market. I understand the idea of providing liquidity, however, this seems dodgy somehow

It is not dodgy at all. It means that the buyer and seller gets the right price for the underlying basket of assets. So as the underlying stocks move up or down, the market maker will adjust their price accordingly. I do not see how you can conceivable see this as being a negative or dodgy at all. It means you the purchaser or seller effectively get what its worth. If the market maker was not there, you might have to take a cent or two less than you would otherwise get. Market makers are pretty much in most ETF's globally.

[arekaywhy]

I appreciate your explanation, just trying to wrap my head around something that appears odd

[Tronald Dump]

I appreciate your explanation, just trying to wrap my head around something that appears odd

Hi, this is standard practice in ETFs (and in fact in any stock traded on the market). Market makers hold inventory to ensure investors can get liquidity if the on-screen volume is not sufficient. Remember the ETF issuer provides a daily NTA for every ETF, so you can easily see what the market value of the ETF was at yesterday’s close. Because ETFs are open ended (i.e. units can be created or redeemed any time), there is no reason why an ETF price would trade a long way from NTA.