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Understanding How ETFs Trade in the Secondary Market

An ETF's liquidity has everything to do with the underlying liquidity of the positions the ETF holds. This has a few implications: Pay attention to the liquidity on the holdings of your ETF--this will explain the spreads in the secondary market; Trade ETFs when the underlyings are liquid--avoid trading ETFs at the open or when overall market volume is lackluster; Avoid huge market orders, and stick to limit orders; Moreover, for huge trades, communicate directly with the market maker or your ETF trading desk.

E.F. Shumacher on Complexity

E.F Schumacher has a great book I've been exploring: Small is Beautiful: Economics as if People Mattered. To be completely honest, the reason I stumbled [...]

Why My Chinese Employees are Leaving…

WSJ recently published an interesting article named "The Self-Inflicted U.S. Brain Drain:" Every year, tens of thousands of disappointed tech workers and other professionals give [...]

Housing market repeat?

I recently came across a few stories about "new" proposals by regulators. Here is the quote from Federal Housing Finance Agency Director Mel Watt: Additionally, Watt [...]

Quant Blog Mashup at TheWholeStreet.com

Mike has a cool concept going over at TheWholeStreet.com. I usually read this alongside AbnormalReturns.com  and then spend 1-2hrs a day reading various academic research websites, [...]

Dow 30,000 Projections–again?

We were all chatting in the office today making fun of our own predictions and the predictions of others. The conversation quickly turned to the [...]

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