Daily ETF Watch: 2 Funds Close

Two of four funds based on Dennis Gartman’s investment philosophy were shut down recently.

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Reviewed by: Heather Bell
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Edited by: Heather Bell

 

Less than a year after their launch, two of the AdvisorShares ETFs focused on the gold trade shut down on Jan. 26. The AdvisorShares Gartman Gold/British Pound ETF (GGBP) and the AdvisorShares International Gold ETF (GLDE) both had less than $1 million in assets under management at the time that the closures were announced.

 

AdvisorShares launched a suite of four actively managed gold-related funds in February 2014, and two of those funds—the AdvisorShares Gartman Gold/Euro ETF (GEUR | D-28) and the AdvisorShares Gartman Gold/Yen ETF (GYEN | D-26), both with less than $15 million in assets under management—will continue trading.

 

GEUR and GYEN, like GGBP, short their designated currencies using futures and take long positions in gold via futures or ETFs, essentially buying gold in their respective currencies rather than in the U.S. dollar.

 

GLDE took a different approach, investing in other gold-focused exchange-traded products, including GGBP, GYEN and GEUR. All four funds were based on the investment strategies of Dennis Gartman, publisher of the Gartman Letter, a subscription-based newsletter offering daily commentary on capital markets.

 

“We believe this consolidation represents a unique opportunity for our firm to concentrate on two emerging investment themes influenced by unprecedented fiscal policies enacted by the Bank of Japan and the European Central Bank. For investors and advisors who seek gold exposure, there can be a definitive difference in purchasing gold in U.S. dollars as opposed to owning gold predicated in euro and yen terms. Stemming on an investment theme long-advocated for by our partner Dennis Gartman, we believe the currency hedging exposure that GEUR and GYEN offer may provide an added benefit to an investment portfolio's gold allocation,” said AdvisorShares CEO Noah Hamman in the press release.

 

Heather Bell is a former managing editor of etf.com. She has also held editorial positions at Dow Jones Indexes and Lehman Brothers. Bell is a graduate of Dartmouth college and resides in the Denver area with her two dogs.