After a sluggish year for closures in 2021, this year is off to a strong start. Last week saw three ETFs either close or start the closure process, while this week saw three Direxion ETFs cease operations and another fund begin to shut down.
The Direxion Dynamic Hedge ETF (DYHG), which launched in June 2020, saw its last day of trading on Friday, as did the Direxion Flight to Safety Strategy ETF (FLYT), which launched in February 2020, and the Direxion Daily Latin America Bull 2X Shares (LBJ), which launched in December 2009. None of the funds ever gathered significant assets.
Meanwhile, the Cabot Growth ETF (CBTG), which rolled out at the very end of 2020, will see its last day of trading on Feb. 2 before liquidating.
For those keeping count, that’s seven closures either completed or in progress in the first month of the year, which saw only four shutdowns completed last year.
A total of 14 ETFs rolled out during the week. Among them was a volatility futures ETF from a newcomer to the ETF space and an actively managed fund from American Century.
On Thursday, first-time issuer Dynamic Shares debuted the Dynamic Short Short-Term Volatility Futures ETF (WEIX) on the NYSE Arca with a 1.85% expense ratio.
WEIX is actively managed to hold more short exposure through VIX contracts as the Cboe Volatility Index rises beyond its historical average, and reduce exposure when the volatility measure falls below historical averages. When the VIX is rising, the fund can raise its notational exposure up to -0.5x the performance of the index on the given day.
The fund will also issue K-1 tax forms to investors due to the issuer’s status as a commodity pool.
Dynamic Shares is registered to Weixuan Zhang, a former intern at Arb Trading Group in Chicago. It initially filed WEIX for SEC approval in June 2019, but was delayed after extended correspondence with regulators.
That same day, American Century Investments debuted its 13th ETF, the Avantis U.S. Small Cap Equity ETF (AVSC) on the NYSE Arca with an expense ratio of 0.25%.
AVSC is actively managed and aims to overweight small cap stocks with higher relative profits and value factors. The fund is benchmarked against the Russell 2000.
Franklin Templeton also announced a name change for one of its funds, while ProShares effected a range of share splits during the week.
Effective Jan. 31, the $72 million Franklin Liberty Federal Intermediate Tax-Free Bond Opportunities ETF (FLMI) will change its name to the Franklin Dynamic Municipal Bond ETF.
ProShares enacted share splits for 17 of its funds. As of Jan. 12, seven funds underwent forward-share splits as follows:
- ProShares Large Cap Core Plus (CSM), 2 for 1
- ProShares Ultra Technology (ROM), 2 for 1
- ProShares Ultra S&P500 (SSM), 2 for 1
- ProShares UltraPro QQQ (TQQQ), 2 for 1
- ProShares Ultra Consumer Services (UCC), 2 for 1
- ProShares Ultra Consumer Goods (UGE), 4 for 1
- ProShares UltraPro S&P500 (UPRO), 2 for 1
At the same time, another nine funds underwent reverse splits as follows:
- ProShares UltraShort Oil & Gas (DUG), 1 for 5
- ProShares UltraShort Dow30 (DXD), 1 for 5
- ProShares Short Real Estate (REK), 1 for 2
- ProShares UltraShort Technology (REW), 1 for 2
- ProShares Short Basic Materials (SBM), 1 for 5
- ProShares UltraShort S&P500 (SDS), 1 for 5
- ProShares UltraShort Financials (SKF), 1 for 2
- ProShares UltraPro Short QQQ (SQQQ), 1 for 5
- ProShares UltraPro Short Russell2000 (SRTY), 1 for 5
And as of Friday, the ProShares UltraShort Bloomberg Natural Gas (KOLD) also underwent a 1-for-5 reverse split.
Contact Heather Bell at [email protected]