Latest / How Canadian Markets Work
How an ETF Is Built Explained: What Keeps ETF Prices Honest? | Canadian Investing
Got something to say to this podcast? Send a voicemail, and you might hear yourself on the next episode!
Episode Summary
This episode deconstructs the elegant structural machinery of the Exchange-Traded Fund (ETF), resolving a fundamental paradox that puzzles many public investors: if an ETF trades freely on an exchange where its price is set by continuous public supply and demand, what prevents its trading price from drifting entirely away from the value of its underlying holdings? We show that while a conventional mutual fund is priced exactly once per day at its net asset value (NAV), an…
The skinny
The skinny isn't ready yet — notes appear once the transcript is processed.