Understanding ETF Liquidity

Last week, iShares posted an excellent video on their blog describing the process of ETF creation and redemption using a simple metaphor.  So today, we thought that we would share this excellent resource.  Here's their summary and the video:

"Ever wonder what allows ETFs to be liquid? The answer is 'creation and redemption,' the process that lets ETFs trade even when volume is low. Using simple illustrations and a metaphor about flowers, this seven-minute animation will change the way you look at ETFs."

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