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Why can SPDRs and MidCap SPDRs be expected to closely track the index levels?

April 26, 2017closely index levels midcap spdrs track

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Why can SPDRs and MidCap SPDRs be expected to closely track the index levels?

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Unlike closed-end funds, SPDRs and MidCap SPDRs can be expected not to trade at significant premiums or discounts to the trusts net asset values because arbitrageurs – traders who profit from small price differences – keep the prices close to their target index levels. These traders watch the price and index levels closely to profit from any divergence.