BLOOMBURG POST REMOVED AGAIN

[u/RogueYorkshire]

[u/[deleted]]

Smooth brain here, what does this mean exactly, there’s a si of %290?

[u/brewmax → u/[deleted]]

That’s the XRT ETF percent of shares owned.

[u/[deleted] → u/[deleted]]

Yeah but there are other ETFs shorted

[u/dfonz420 → u/brewmax]

So is xrt gonna squeeze too b/c of this

[u/[deleted] → u/dfonz420]

An etf cannot be squeezed. They can create shares at any time meaning there will never be supply issues

[u/Chuckles77459 → u/[deleted]]

This ^ deep convos about it back when the ETF shorting was discovered.

[u/ZenoArrow → u/[deleted]]

How do ETF issuers create shares? I had thought ETF trade on the weighted price of multiple shares, with the issuers needing to buy and sell the stock tracked in the ETF to keep the expected risk profile. I haven't heard anything about them being able to issue stock before.

[u/ZenoArrow → u/[deleted]]

Oh, you're referring to creating and removing ETF shares, for some reason I had thought there was a suggestion they could create GME shares, which is what made me confused. In any case, thanks for the clarification.

[u/suckercuck → u/[deleted]]

They have to be rebalanced to maintain proper weighting though.

[u/slicketyrickety → u/dfonz420]

I don't think so because the share liquidity is greater, correct me if I'm wrong tho

[u/TECHNOV1K1NG_tv → u/dfonz420]

Explanation of why ETF wouldn't "squeeze". The process is called arbitrage. It will also start to make sense how these hedgefunds can short Gamestop via the ETF.

https://www.investopedia.com/articles/investing/032615/how-etf-arbitrage-works.asp

tldr; the ETFs need to "balance" their market cap and their underlying assets through a market maker on a minute-to-minute basis. The purpose is to keep the ETF price stable.

[u/positive_root → u/dfonz420]

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