Thursday, August 22, 2013

Unreal

ETFs are managed by managers who buy and sell different securities too try to match the performance of the underlying issue the ETF is suppose to track, yes it's much more convoluted than you'd think, that means if you don't know every asset those managers use in each ETF, even if it trades on NYSE (and has NASDAQ components), you don't know if you can trust the ETF or not.

I just got through listening to a lesson on the VEEE-WAP from someone on CNBC who has never heard of it as she admitted, "I don't remember what that acronym stands for", It's Volume Weighted Average Price and even reading from cue cards she still couldn't spit it out correctly, but managed to pass on the information that the VWAP's of ETFs are not matching up as they should be, whatever in the heck she is talking about I don't know, but I do see how the ETFs component stocks would be a huge issue for non-NASDAQ listed ETFs.

In short, it's pretty darn difficult to know what to trust here and now, but I am watching very carefully for anything that jumps out.



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