Average Daily Trading Volume of an ETF
The average daily trading volume of an ETF takes the amount of shares that an ETF has traded over some time period in the past and calculates an average of the volume for each of those days. In an ETF with rapidly growing assets, this average will be lower than its more recent trading volumes, since it includes what has happened in the past. If the average is very low, and there are some very high volume days, then a new investor is given an idea of what could potentially happen in the fund. Because this is based only on actual ETF trading volume and not the underlying basket, however, it does not provide a representation of the liquidity of the underlying basket itself. A high trading volume in an ETF, ...
Get Visual Guide to ETFs now with the O’Reilly learning platform.
O’Reilly members experience books, live events, courses curated by job role, and more from O’Reilly and nearly 200 top publishers.
