As part of the due diligence process, investors should review fund ownership information found in SEC Form 13F.
Moreover, “not every ETF is created equally and not every ETF issuer is equal,” LaValle says. “Investors need to engage in due diligence when selecting a product and when aligning with an issuer. That issuer is a tremendous resource, especially during times of uncertainty.”
The upshot is that upgrades on the exchanges, coupled with broad-based changes by the liquidity providers, injected more confidence into the market following the August 24 event from two years ago, just as the limit up/down rule solved for the problem of erratic trading faced on May 6, 2010. But the markets are always changing, so dislocations will occur. The most important thing for investors is to stay in control, and limit orders are the best defense.