Does volume really matter?
Underlying liquidity will begin to tell the story of how liquid an ETF could be, no matter what the average daily volume (ADV). But how do you measure that liquidity?
For equity-based ETFs, a first step is to examine the top 10 holdings to see if they are “household” names. If they are not, you may want to investigate further, utilizing a tool such as Bloomberg’s implied liquidity field listing.