Knight's most recent issues are proving particularly problematic for the ETF world.

According to IndexUniverse, the average spread for an ETF trading less than 50,000 times per day has doubled since the trouble began, from 56 bps to 94 bps.

For low-liquidity ETFs, where Knight is the Lead Market Maker according to the report, the spread has gone from a 49 basis point average to 153 basis points.

The IndexUniverse article, written by Dave Nadig, cautions that this "means if ever there was a time to tread carefully into illiquid ETFs, now's that time."

The story was also picked up by Business Insider, Reuters, and BloombergBusinessweek 

Edited by: Ben Geier


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