There are several ETFs listed on the American Stock Exchange (AMEX). One of them is iShares-Switzerland. This ETF tracks the Morgan Stanley Capital International (MSCI)-Switzerland index, which is based on several stocks that trade on the Swiss Exchange. The Swiss Exchange is open from 9 a.m.to 5:30 p.m. Swiss time and the AMEX is open from 9:30 a.m. to 4 p.m. U.S. Eastern Standard Time (EST). The U.S. EST lags the Swiss time by six hours. Discuss whether the ETF price and its NAV would fluctuate or stay the same during the time period when the AMEX is open.

Question

Quizplus · Accepted Answer

The Answer is When the AMEX market opens at 9:30 a.m., the time in Switzerland is 3:30 p.m. and the Swiss exchange is still open. The ETF shares in the United States would open at a price based on the NAV in Switzerland at that time and the prevailing dollar to Swiss franc exchange rate. From 9:30 a.m. to
11:30 a.m., both the AMEX and Swiss exchange are open, and the NAV in Switzerland would continue to change. The price of the ETF in dollars would also be changing consistent with the changes in NAV and exchange rate. Subsequently, from 11:30 a.m. to 4 p.m., the AMEX is open but the Swiss exchange is closed. So, the NAV in Swiss francs would remain the same. However, the price of the ETF in the United States would change based on the changes in expectations about the future stock prices in Switzerland and the changing exchange rate.

There Are Several ETFs Listed on the American Stock Exchange