Mutual Funds/total net asset

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Question
Isn't the TNA (total net assets) amount controlled by supply and demand. For ex say a ETF TNA is 3.5bn. If a investor wanted to invest 6 bn in the ETF would the TNA increase to accomadate his order

Answer
Dan,

The assets of an ETF would be determined by supply and demand as well as pricing of its holdings. Retail investors buy and sell ETFs in the secondary market while institutional investors buy and sell directly with the ETF(Issuer)in large quantities called creation units. Assets would go up if there an increase in demand for creation units.

I hope this helps.
Michael

Mutual Funds

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Michael Weiss, CFA

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