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What are market makers and what do they do?

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What are market makers?

Market Makers are important part of ETFs and play a critical role in their underlying liquidity.

As you are probably aware, ETFs are open ended funds, unlike listed companies which only have a certain number of shares on offer to trade.

This means that ETFs create and redeem shares to meet the demand from investors. Market Makers are appointed by the Responsible Entity of the ETF to ensure that there are enough shares on offer to meet this demand.

What do market makers do?

Put simply, Market Makers provide much needed liquidity to ETFs when traded on the stock market. They work with the Responsible Entity to create and redeem shares to keep ETFs priced fairly.

In the main, Market Makers are generally invisible to you and your financial adviser or broker, going about day-to-day doing their important role.

Just so that you know, the Market Maker for eInvest Funds is Macquarie Securities Australia, a subsidiary of Macquarie Bank, or Deutsche Securities Australia Limited.

For more information, please read the Fund’s PDS for more information on the role and responsibilities of a Market Maker.