The exchanges are clamoring lately to get their hands on exchange traded funds (ETFs). Earlier this month, Nasdaq announced its creation of a new ETF segment and the New York Stock Exchange announced the movement of ETFs to the electronic trading platform, NYSE Arca. Both exchanges will feature market makers to help maintain liquidity, explains Lawrence Carrel for TheStreet.com. NYSE Arca claims Nasdaq is simply playing catch up. Nasdaq adds its version is new and improved from NYSE Arca.
Specialists have been influential in the growth of the ETF industry by providing the funds to get them started and maintaining an orderly market. But the more narrowly-focused ETFs do not trade as often, and specialists are less inclined to support them. In response to this, the exchanges are working to create platforms, which will maintain liquidity in the ETF marketplace.
Currently Nasdaq lists 20 ETFs, NYSE lists 195 and the American Stock Exchange lists 333.
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