ETF Mechanics
In-Kind Creation
Definition
What is In-Kind Creation?
The creation of ETF shares by delivering a basket of securities rather than cash.
Example in practice
How This Looks in Practice
A participant transfers the index shares to the fund and receives new ETF units.
Keep learning
Related Terms
ETF Mechanics
Creation Unit
A large block of ETF shares exchanged between the fund and authorised participants.
ETF MechanicsAuthorised Participant
A financial institution permitted to create and redeem ETF shares directly with the fund.
ETF MechanicsETF Premium
The amount by which an ETF's market price exceeds its net asset value per share.
Fund OperationsDealing Cut-Off Time
The deadline by which a valid fund instruction must be received for a particular dealing day.