Another Newbie ETF question.

Fly100

Hello all,

As im trying to educate myself further, I have another question.

https://stockanalysis.com/etf/jepq/  is listed here @  $56.30 however if I look on my Trading 212 account its listed @ $25.72. The name is the same and the ticker code & the ISIN number, but the price is differnet.

Could some explain what the differences are please.

Thank you in advance appreciate the education.

FLY

masonic

If you are buying on the London Stock Exchange the correct price is $25.72. The other website is for the listing on NASDAQ,

tichtich

I'm not an expert on this, but I would think that the UK and US ETFs are separate funds (not just different listings of the same fund), so there's no reason they should have similar prices. 

gm0

A small selection (relative to US) of ETFs are traded on LSE. 

Often in Sterling prices GBP.  So the "unit values" of a "share" in the etf are in GBP.  You buy and sell a unit in GBP.   It is held in the UK custody arrangements. 

The underlying investments upon which these tradeable units are based may well be global overseas assets (anywhere in the world and in multiple countries and currencies).  And be the same asset mix and mandate as a fund listed on NYSE which may be the "parent" vehicle in many cases..

Such an investment vehicle will have a base currency used for assets and returns to be aggregated repatriated from around the world and this may well be something different to your purchase/sale currency - it is often USD (especially for US etfs with a UK 2nd listing) or it can be EUR or something else for Asia.

As life rolls along investments are bought and sold (wherever they are) - taxes paid - returns rolled up - in USD (if that is the base currency).  Passive index adjusting or active fund trading.  So at any moment the investments (if publicly traded) have a mark to market value - in the base currency of the fund - USD for our example.

The "value" of that funds underlying holdings based on its investments - ignoring speculative and order book demand/supply influences on the daily price on the exchange for the moment is $X.   And the LSE version is £Y - based on the FX rate for GBP and USD.   Exchange prices may deviate from that value - based on order flow and general sentiment the price(s) may dip or rise around that - on either market.  As there is separate order flow to both.

But there is a strong underyling incentive for the US version in $ and the UK version in £ to track closely to the same value - bar translation for currency (and see below - unit size of a share).  If they did not - then you could hold the same market asset exposure at different prices - sell one high, buy the other low.  Arbitrage.   Subject to taxes and trade costs.

Somewhat reaching the limits of my understanding. 

Additionally across the various types of trust, open, closed fund and etf types there are extra complexities beyond FX where a pool of stuff has a unit price which is linked to the number of them and to the size of them.

Like an individual stock splitting when it goes high and people want a more acceptably sized lego block. 2 $25 shares = 1 $50 share.  Same exposure to the fund.  Different price.  Different collective vehicles - trusts, open ended, closed ended, single exchange etf, multiple share classes, multi-listed ETF. may run into this issue with different shares. 

If the "unit sizes" of shares are not the same then the relationships won't be FX alone but that lego block size ratio will also apply.

As upthread.  Different share of different fund.  = Different price.  Even if underlying asset exposure is intended to be the same - fund mandate.