State Street Global Advisors wants investors to trade “ETFs with confidence” at “the lowest possible trading costs,” said Vice President Kimberly Russell.
See more: “SPY Is a Critical Part of the ETF Industry”
At Exchange 2023, SSGA was celebrating the 30-year anniversary of the SPDR S&P 500 ETF Trust (SPY). This “coincides with the 30-year anniversary of an industry that today offers… more than 8,000 ETFs globally,” Russell said.
“SPY is the most heavily traded Security in the whole world,” she told NYSE’s Jude Shaw. “But the reality is that ETFs vary across a wide spectrum in the liquidity that’s available to buy and sell for investors.”
So, SSGA works with market participants who provide liquidity in ETFs and keep prices in line with the portfolio’s value.
SSGA works with exchanges like NYSE that put liquidity incentive programs together and operate volatility mechanisms. This protects “investors in periods of market volatility when bids and offers may evaporate from the market,” Russell said.
Added Russell: “We’re advocating for market structure developments that enhance the investor experience.”
Russell said SSGA is seeing “a lot going on in the space across equity market structure.” This includes “potential reforms that could impact ETF liquidity.”
But it’s not just the equity market structure. Russell also noted there are “fixed income market structure developments that play into fixed income ETFs as well.” These developments include “things like shortened trade settlement, which is a big focus of the industry.”