Personal Finance & Money Asked on January 24, 2021
I have been looking here for the information on the Bid/Ask spread of the Vanguard Ftse All-World Units Etf A on the Italian market. Here it is reported "Ask: n.d. X n.d" and "Bid: 84,1 x 119", with a price of €84,64. What does it mean that the aks is not defined? Should I instruct my bank to buy with a limit order strategy? Moreover, how can I be sure that the price of the ETF correspond to the price of the underlying stocks (the ETF follows an index but is not supposed to be exactly equal to that index) and is not artificially inflated by the demand and offer forces of the secondary market?
The Vanguard FTSE All-World UCITS ETF is an Irish UCITS structured fund, which prices its portfolio daily at the close of market. This level of transparency encourages authorized participants/market makers to engage in arbitrage to keep the market price in line with the net asset value of the fund. I'd expect very minimal premium/discount spreads as long as the underlying securities are liquid, which they should be given the funds investment strategies.
Answered by Matthew Vandergrift on January 24, 2021
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