ETF Fundamentals
The type of ETF that is designed to track an index
What is passive ETF?
The price at which somebody in the market will buy a share
What is the bid?
The place in which APs create/redeem ETF shares
What is the primary market?
The difference between the bid and the ask
What is the spread?
VanEck's largest fund by AUM
What is SMH?
The type of ETF that is designed to outperform a benchmark
What is active ETF?
Often averaged over 30 days, this metric captures how many shares of an ETF typically trade each day
What is Average Daily Volume (ADV)?
The place in which investors can buy/sell exisiting ETF shares
What is secondary market?
The tighest spread quoted for a given ETF
What is the National Best Bid/National Best Offer (NBBO)?
Most recently-launched ETF
What is SMHC?
A self-clearing, US-registered broker dealer that can create or redeem ETF shares in the primary market
What is an Authorized Participant?
The portion of liquidity that is visible to traders
What is displayed ("on-screen") liquidity?
The AP delivers/receives shares of the underlying securities in order to create/redeem ETF shares
What is in-kind creation/redemption?
Order type that allows you to set the max and min price when buying/selling shares
What is limit order?
VanEck's revenue source
What is charges expense ratio on total AUM?
A broker-dealer that provides two-sided quotes throughout the trading day
What is a market maker?
The "true" liquidity of an ETF, determined by its underlying constituents (i.e. basket)
What is primary market liquidity?
The AP delivers/recieves cash to create/redeem ETF shares
What is cash creation/redemption?
Order type that allows you to buy or sell a security immediately at the best available current price
What is market order?
VanEck's first ETF
What is GDX?
Intrinsic value of an ETF
What is iNAV/IOPV?
The price one would pay to buy 1000 shares
200 @ 28.16 / 28.17 @ 900
400 @ 28.15 / 28.18 @ 300
What is 900 shares @ 28.17 and 100 shares @ 28.18?
The share size increment in which a given ETF must be created/redeemed (e.g. 25,000 ETF shares)
What is creation unit size?
The difference between an ETF's market price and its instrinsic value
What is Premium/Discount?
DAILY DOUBLE: VanEck converted this ETF from a mutual fund in October
What is EMBX?