Monday, 5 December 2016

Exchange traded funds: Taking over the markets

Exchange traded funds: Taking over the markets:

"Stock markets have a new purpose. Once devoted to trading stocks and setting their prices, they are now the venue for buying and selling something other than shares: exchange traded funds.

ETFs are taking over markets. Shares in Apple, the world’s biggest and most heavily traded company, turn over more than $3bn each day. But that is dwarfed by the biggest ETF, State Street’s SPDR S&P 500, which trades more than $14bn each day. Five of the world’s seven most heavily traded equity securities are ETFs.

“From a modest beginning, ETFs’ impact on stock trading has now reached mammoth proportions, and ETFs now account for nearly one-half of all trading in US stocks,” says Jack Bogle, founder of asset manager Vanguard."



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