ETF LIQUIDITY:
ETF liquidity defines how easily and efficiently an ETF can be bought or sold without affecting its market price. Ask price does not differ much from bid price and rhis spread is reduced. Liquidity is defined by Trading Volume (daily trading volume of the ETF.
ETF liquidity defines how easily and efficiently an ETF can be bought or sold without affecting its market price. Ask price does not differ much from bid price and rhis spread is reduced. Liquidity is defined by Trading Volume (daily trading volume of the ETF.
Comments
1) Lowers Is Trading Costs (tighter bid-ask spreads),
2) makes easier Entry & Exit (buy and sell due to high availability and demand) and
3) makes pricing more accurate (keeps ETF prices aligned with the NAV
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