Watch Bid-Ask Spread on Low Volume ETFs

Small ETFs with low trading volume can trade with above average bid-ask spreads according to Eleanor Laise at the Wall Street Journal.

In the article, For Some Investors, Night of Living ETF, Ms. Laise writes that more than a quarter of the ETFs on the market are hitting shareholders with high trading costs that escape many investors’ notice.

Examples of ETFs with large bid-ask spreads include Claymore U.S.-1-The Capital Markets Index ETF (UEM), SPDR S&P Emerging Asia Pacific (GMF) and iShares S&P Target Date Retirement Income Index Fund (TGR).

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