ETFs is just a tracking mechanism and the units creation and redemption is done via market maker not fund managers
fund manager can buy any sell anything and so is everyone else who participates in the market.
Say I want to invest 100K in the market and I don't want to buy a single stock, I just get say SP500 index
I throw in my 100K order to the ETFs code, if there is no sell on the other side or not enough off it
the market marker will then start the process of unit creations by acquiring the underlying basket that representing the index to filled my
100K order and vice versa if I want to sell, if there isn't enough buyer on the other side, market maker start the process of unit redemption
and start selling the underlying shares.
fund managers and everyone else in the market can buy and sell these shares in the unit creation and redemption process and the market maker is there to snapped up or let it go according to the supply and demand of the ETFs just like anything else on the market
S&P500 is very good representation of the US economy and so is Australia ASX300, if you buying those index you sure to get market return of those economy
Ann: On-Market Share Buy-Back, page-82
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