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(Chapter 4) You are an individual investor who is bullish on the finance sector of the US equity market. Rather than purchase shares of stock

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(Chapter 4) You are an individual investor who is bullish on the finance sector of the US equity market. Rather than purchase shares of stock of several individual firms in the sector, you decide to reduce trading costs by purchasing XLF, a US finance sector equity ETF. How can you be confident that the price of the XLF will closely track the net asset value (NAV) of the underlying shares of stock in the benchmark index? 4. (Chapter 4) You are an individual investor who is bullish on the finance sector of the US equity market. Rather than purchase shares of stock of several individual firms in the sector, you decide to reduce trading costs by purchasing XLF, a US finance sector equity ETF. How can you be confident that the price of the XLF will closely track the net asset value (NAV) of the underlying shares of stock in the benchmark index? 4

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