Common use of Liquidity risk Clause in Contracts

Liquidity risk. It is not guaranteed that a liquid market exists for an ETF. A higher liquidity risk is involved if an ETF uses financial derivative instruments, which are not actively traded in the secondary market and whose price transparency is not as easily accessible as securities. This may result in a bigger spread. And, they are also susceptible to more price fluctuations and have a higher volatility. Hence, they can be more difficult and costly to unwind early, when the instruments provide access to a restricted market where liquidity is limited.

Liquidity risk. It There is not guaranteed no assurance that a liquid market exists for an ETF. A higher liquidity risk is involved if a synthetic ETF involves derivatives which do not have an ETF uses financial derivative instruments, which are not actively traded active secondary market. Wider bid-offer spreads in the secondary market and whose price transparency is not as easily accessible as securities. This of derivatives may result in a bigger spreadlosses. And, they are also susceptible to more price fluctuations and have a higher volatility. HenceTherefore, they can be more difficult and costly to unwind early, when the instruments provide access to a restricted market where liquidity is limited.

Liquidity risk. It There is not guaranteed no assurance that a liquid market exists for an ETF. A higher liquidity risk is involved if a Synthetic ETF involves derivatives which do not have an ETF uses financial derivative instruments, which are not actively traded active secondary market. Wider bid-offer spreads in the secondary market and whose price transparency is not as easily accessible as securities. This of derivatives may result in a bigger spreadlosses. And, they are also susceptible to more price fluctuations and have a higher volatility. HenceTherefore, they can be more difficult and costly to unwind early, when the instruments provide access to a restricted market where liquidity is limited.

Liquidity risk. 6.3.2.5.1 It is not guaranteed that a liquid market exists for an ETF. A higher liquidity risk is involved if an ETF uses financial derivative instruments, which are not actively traded in the secondary market and whose price transparency is not as easily accessible as securities. This may result in a bigger spread. And, they are also susceptible to more price fluctuations and have a higher volatility. Hence, they can be more difficult and costly to unwind early, when the instruments provide access to a restricted market where liquidity is limited.