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Passive investing, ETF bubbles & market makers ft. Betashares

Australian Finance Podcast

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The Power of ETFs in the Market

The more widely adopted and the more diversified an ETF we tend to see better liquidity. That's where you can see some real compression in the bidar spread. It also means that the underlying basket of stocks within thatETF doesn't need to be traded because effectively that underlying basket is just being passed from one investor to another. And it's that increased volume and that uptake which is sort of self fulfilling in terms of the advantage.

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