Trillions cover image

Trillions

10 Billion Served: The Unsung Role of an ETF Market Maker

Nov 29, 2018
The podcast discusses the important role of ETF market makers in providing liquidity for popular and lesser traded ETFs, comparing it to the smooth functioning of a machine. They also explore the rise of Susquehanna, a renowned market maker in the ETF industry, and how poker skills have been applied to financial markets. The process of creating and redeeming ETF shares is explained, along with the revenue and margin of ETFs compared to mutual funds. The speakers also touch on marketing strategies and upcoming events.
32:30

Podcast summary created with Snipd AI

Quick takeaways

  • Market makers ensure smooth trading and provide liquidity, making ETFs less prone to attacks and concerns.
  • Smaller proprietary firms have successfully filled the void in ETF market making and provide liquidity for less actively traded ETFs.

Deep dives

Market making and its role in the ETF world

Market making is like the oil that keeps the machine running in the ETF world. Market makers provide liquidity and ensure smooth trading by constantly buying and selling ETF shares. Over the years, market makers have facilitated trillions of dollars' worth of trades, with only a small fraction resulting in trade-related issues. This reliability and efficiency are why ETFs are less prone to attacks, criticism, and concerns.

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