The way that these ETFs work is that the managers of the funds issue creation baskets in increments of a certain number of units and offer them for sale to authorized purchasers, which are generally large brokerage firms. However, sometimes the fund can hit a limit of units and “freeze” trading, in the case of the natural gas ETF.
This regulation is being imposed at a time when the Obama administration is trying to increase transparency and regulation of the financial markets.
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Kevin Grewal contributed to this article.