A zombie ETF alludes to exchange traded funds that are seeing less exchanging volume or expanded investment.
These funds are depicted as zombies since they aren't developing and are probably going to be cut by the issuer.
As it were, the exchange traded fund might be dead as of now and just not know it.
Exchange traded fund s resemble numerous fiscal instruments, in that an absence of new capital flowing in as well as exchanging volume the equities can be a terrible sign.
The liquidity concerns with the low trading volume drives investors away even as the expenses of directing a fund that isn't pulling new capital inflows disintegrates profitability for the issuing firm.
Zombie exchange traded funds are not by any means the only zombies in the realm of finance.
There are zombie banks, zombie debt as well as zombie titles.
In economics, "zombie" is commonly used to portray circumstances where capital is tied up without a clear way to goals.
Zombie exchange traded funds additionally fall into this kind of portrayal in that the issuer has a fund that is not drawing in new funds and isn't seeing its equities exchange any critical sum.
So the issuer is left holding a fund that costs money to keep up however has little possibility for development.
In this circumstance, it is normally just a short time before the issuer closes down the exchange traded fund being referred to.