Originally Posted by JB
Does anyone have experience trading large sums into ETFs?* Did the broker break it up into smaller purchases at increasing prices? Do any brokers offer limit purchases relative to NAV?
I don't have a lot of large-sum experience, but from what I've read the arbitrage is pretty fierce. If the price ever dropped to .99 NAV you'd see some pretty brisk trading by the big guys to buy the ETF and break it up into the creation units. I don't know how long the edge would last.
If I buy 1000 shares of a $17 ETF the broker (Fidelity) seems to execute one trade at 100 shares and follow it up with the other 900 at the same price. Same for both PID and IJS. I've bought bigger units of other ETFs (especially QQQs) but I can't remember if there was any effect on the price. But QQQ is much more liquid than the other two ETFs.
I've never seen limit purchases relative to NAVs, but you could talk directly to Fidelity's trading desk or your broker. Fidelity gives away specialized frequent-trader software that might offer features that I don't get from the website. I guess you could also try to put in your own daily limit buy orders if the price isn't moving that quickly.