Friday was the last day of trading for 15 Direxion ETFs, a record closure number for the company, which has been on a bit of a closing spree. Earlier this year, it shuttered eight funds during the March market meltdown, and another nine are scheduled to cease trading on Oct. 16. That brings a total of 32 fund closures for all of 2020 for the company, unless it decides to shut down even more.
This latest round wipes out Direxion’s “lightly leveraged” PortfolioPlus family of ETFs, which offered 1.25x leverage resetting daily on core asset classes. Leveraged exchange-traded products typically offer 3X leverage resetting.
It also shutters four of the five long/short pairs of ETFs that Direxion launched in early 2019.
The 15 funds that closed on Sept. 25 are as follows:
- PortfolioPlus Developed Markets ETF (PPDM)
- PortfolioPlus Emerging Markets ETF (PPEM)
- PortfolioPlus S&P 500 ETF (PPLC)
- PortfolioPlus S&P Mid Cap ETF (PPMC)
- PortfolioPlus S&P Small Cap ETF (PPSC)
- Direxion MSCI USA Cyclicals Over Defensives ETF (RWCD)
- Direxion MSCI USA Defensives Over Cyclicals ETF (RWDC)
- Direxion MSCI Developed Over Emerging Markets ETF (RWDE)
- Direxion MSCI Emerging Over Developed Markets ETF (RWED)
- Direxion FTSE Russell International Over US ETF (RWIU)
- Direxion FTSE Russell US Over International ETF (RWUI)
- Direxion Russell Large Over Small Cap ETF (RWLS)
- Direxion Russell Small Over Large Cap ETF (RWSL)
- Direxion Daily Small Cap Bull 2X Shares (SMLL)
- Direxion Daily 20+ Year Treasury Bear 1X Shares (TYBS)
This year the ETF industry had already blown past previous closure records by significant margins, and the gap has only continued to grow. The Direxion ETFs that are slated to shut down in mid-October include the following:
- Direxion Daily MSCI Developed Markets Bull 3X Shares (DZK)
- Direxion Daily MSCI Japan Bull 3X Shares (JPNL)
- Direxion All Cap Insider Sentiment Shares (KNOW)
- Direxion Daily Consumer Staples Bear 3X Shares (LACK)
- Direxion Daily Communication Services Index Bear 3X Shares (MUTE)
- Direxion Daily Consumer Staples Bull 3X Shares (NEED)
- Direxion Daily Consumer Discretionary Bear 3X Shares (PASS)
- Direxion Daily Communication Services Index Bull 3X Shares (TAWK)
- Direxion Zacks MLP High Income Index Shares (ZMLP)
Other ETF closures scheduled for October include:
- ProShares Ultra Communication Services Select Sector ETF (XCOM), Oct. 1
- ProShares UltraShort Communication Services Select Sector ETF (YCOM), Oct. 1
- Pacific Global International Equity Income ETF (IDY), Oct. 16
- Pacific Global US Equity Income ETF (USDY), Oct. 16
- USCF SummerHaven SHPEI Index Fund (BUY), Oct. 14
With these closures, the total for 2020 will be at least 212. That’s far beyond the 126 closures in all of 2019, the 156 in all of 2018, and 138 in all of 2017. Until now, 2018 held the record for the year with the most closures. The number also outstrips the 196 launches that have taken place so far this year, an entirely unprecedented occurrence.
But it’s not that COVID and the market crash had much effect on launches. Last year, there had been 176 launches by this time, and in 2018, there were 199 launches by this time. Only 167 ETFs had launched by Sept. 28 in 2017.
Contact Heather Bell at [email protected]