The first seven months of 2018 suggest a record-breaking year is in the making, possibly on two very different fronts. Launches and closures are both outpacing those in 2017, which was a record year for closures and which nipped at the heels of the record set in 2011.
In 2017, a total of 138 funds shut down, with 63 of those closures happening by the end of July. This year, there have been 97 ETF shutdowns during those first seven months.
Much of that is due to the highly unusual closure of 50 Barclays iPath ETNs in April. When you factor out those 50 closures, though, the year is actually trailing 2017 in terms of closures. Still, although the industry could surprise us, it does seem likely 2018 will glide to yet another record for shutdowns.
Fewer Launch Records
Although record-breaking years for closures have occurred fairly frequently over the past decade, they’ve been less frequent for ETF launches. In 2011, there were more than 300 rollouts. The closest we’ve come since then was 284 new ETFs launched in 2015. However, more than 270 ETFs launched last year, bringing that relatively close to the record set in 2011.
This year, launches through the end of July stand at 143 versus 127 for 2017. If the pace continues, 2018 could meet 2011’s record or possibly even overtake it.
Perhaps the biggest rollout of the year so far has been that of the JPMorgan BetaBuilders Japan ETF (BBJP), which is nearing $1.8 billion after rolling out in June. The Barclays ETN+ FI Enhanced Global High Yield ETN Series B (FIYY), a bespoke product mainly used by Fisher Investments for its in-house strategies, is trailing behind it, with $1.6 billion in assets after making its debut March.
The Barclays ETN+ FI Enhanced Europe 50 ETN Series C (FFEU), another bespoke Fisher product, is in third place, with $746.5 million after a March launch, followed by the JPMorgan BetaBuilders Europe ETF (BBEU), with $406.3 million. The Communication Services Select Sector SPDR Fund (XLC) is the fifth-largest launch of 2018, with $358.8 million in assets.
Contact Heather Bell at [email protected]