Due to the unique in kind Creation/Redemption mechanism of ETF, there exists the
phenomenon of appreciation and depreciation. When the market price of ETF is above
its net assets value(NAV), there is an appreciation; on the contrary, an depreciation
occurs. However , the fact that institutional investors sell ( when appreciation
exists and , at the same time, exchanging the index basket for the ETF ) / buy (
when depreciation exists and , at the same time, exchanging the ETF for index basket
) the ETF in the secondary market lowers/improves the market price of the ETF and
eventually minimizes the gap between the market price and the NAV of the ETF.