Some ETF Spreads Widen as Knight Capital Seeks to Survive (KCG)
The average spread between bid and offer prices for some lightly traded U.S. exchange-traded funds widened yesterday as Knight Capital Group Inc. (NYSE:KCG), the biggest market maker for ETFs, struggled to survive.
Spreads on low-liquidity ETFs for which Knight is the lead market maker on the New York Stock Exchange rose to 1.53 percent yesterday, according to data compiled by research firm IndexUniverse LLC. The spread averaged 0.49 percent before Aug. 1, when a computer glitch at Knight caused losses nearly four times the firm’s profit last year.
See the full Bloomberg Article: HERE