From Seeking Alpha:

The U.S. stock market saw extreme volatility on Monday, August 24th, with some crazy trading after market open. Many stocks declined sharply and many ETFs fell 20% or more and some as much as 30%-45%, even though their underlying stocks had not declined so much.

ETFs are baskets of securities and they usually trade close to the aggregate value of their holdings. Significant dislocations from their NAVs are rather unusual for ETFs. However that morning, large dislocations in ETFs’ prices were seen not only in smaller ETFs but in some very large and popular ETFs as well. While these discrepancies lasted only for a short period of time, none of the trades executed during that time were canceled.

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