In what’s starting to look like an annual summer clearance event, State Street Global Advisors has announced its most sweeping round of ETF closures yet. A stunning 19 funds are scheduled to see their last day of trading on July 24.
Last August, State Street shut down a dozen funds that were struggling, including a few that had significant assets under management, such as the SPDR Nuveen Barclays California Municipal Bond ETF (CXA), which had nearly $150 million in assets, and four other funds with more than $50 million. Then in November, it shut down another five funds, bringing the total number of closures for 2016 to 17 ETFs.
Foreign Equity Focus
This time around, except for a U.S. TIPS ETF, the funds are all focused on foreign equities. The mix includes two currency-hedged ETFs, three regional emerging market ETFs, two multifactor ETFs and 10 international sector ETFs.
The largest is the SPDR S&P International Health Care Sector ETF (IRY), with close to $200 million in assets, followed by the SPDR S&P International Technology Sector ETF (IPK) and the SPDR S&P Emerging Europe ETF (GUR), which both have more than $50 million in assets under management. The three largest funds each have been trading for a decade.
Russia Closure Unsurprising
Given how much Russia has been in the news, the closure of the SPDR S&P Russia ETF (RBL) is interesting, but unsurprising. RBL, with $25.5 million, is dwarfed by competing offerings from VanEck and iShares. The VanEck Vectors Russia ETF (RSX) and the iShares MSCI Russia Capped ETF (ERUS) have $2 billion and $454 million in assets, respectively.
In all, the 19 funds that are set to close represent $677 million in assets for SSGA. For perspective, that’s tiny compared with the $237 billion invested in the SPDR S&P 500 ETF (SPY) and SSGA’s total of $540 billion in U.S.-listed ETF assets. The closures will also drop the number of ETFs from 150 to 131.
This latest round of announced closures means that at least 66 funds will have shut down by the end of this summer.
Contact Heather Bell at [email protected].