Another Wave Of ETF Closures

Four funds closed on Monday, and another shutdown is set for Oct. 1. Direxion was behind three of the closures that took place Sept. 24, while CSOP was behind the fourth. AdvisorShares is the issuer of the fund set to close at the start of next month.

Direxion’s Shutdowns
The three funds issued by Direxion included:

• Direxion Daily Silver Miners Index Bull 2X Shares (SHNY)
• Direxion Daily Emerging Markets Bond Bull 3X Shares (EMBU)
• PortfolioPlus Total Bond Market ETF (PPTB)

With silver and emerging markets trending downward year-to date, it’s not surprising funds offering to capture two and three times the performance of those asset classes were not gathering much in the way of assets.

PPTB, however, was part of Direxion’s “lightly leveraged” PortfolioPlus family. The fund was the lone fixed-income product in the family and had not gathered much in the way of assets. Meanwhile, the five equity funds have combined assets under management of $162 million.

CSOP’s Closure
The shutdown of the CSOP China CSI 300 A-H Dynamic ETF (HAHA) means that CSOP only has two ETFs listed in the U.S., neither of which has more than $10 million in AUM. The issuer is part of CSOP Asset Management, a Hong Kong-headquartered company, and its ETFs all offer different exposures to China’s markets.

The closure of the Direxion and CSOP funds brings the total shutdowns for 2018 to nearly 130. With a full quarter remaining to the year, it is highly probably we will cross the record for closures of 138 that was set in 2018.

Of course, this year’s number is inflated by the unprecedented shutdown of 50 iPath ETNs in April. With such a dramatic boost, it would be surprising if the record weren’t broken.

Future Closure

In fact we already have a few closures scheduled for the month of October. The most recently announced is the AdvisorShares KIM Korea Equity ETF (KOR), an actively managed fund targeting Korea. It will see its last day of trading on Oct. 1. It will be the second ETF issued by AdvisorShares to close this year. The firm shut down seven of its funds in 2017. It currently has a 16 listed ETFs.

Contact Heather Bell at [email protected]