The ETF graveyard claims another four niche funds.
Global X Funds, the New York-based fund provider known for niche ETF strategies, on Oct. 18 is closing down four of its ETFs that have failed to attract assets, which combined represent less than 1 percent of the firm’s total assets under management.
The four funds will stop trading on Oct. 18 and be completely liquidated by Oct. 26, a Global X representative told IndexUniverse. The ETFs and their respective assets as of Friday, Sept. 21, include:
- Global X Aluminum ETF (NYSEArca: ALUM), $2.4 million in assets
- Global X Auto ETF (NYSEArca: VROM), $2.7 million
- Global X Nasdaq 500 ETF (NasdaqGM: QQQV), $1.5 million
- Global X Nasdaq 400 Mid Cap (NasdaqGM: QQQM), $1.4 million
The funds are the latest to join a growing ETF graveyard that has most recently claimed Scottrade’s FocusShares ETFs and Russell’s entire lineup of ETFs, with the exception of one actively managed fund.
While ETF closures are to be expected as the market matures and more funds are launched vying for the same pool of investor assets, the pace of fund liquidation year-to-date is exceeding last year’s pace. Since the beginning of the year, 86 ETFs and ETNs have already been shut down, a significant jump from the 30 funds closed in 2011.
Back in December, Global X closed eight ETFs that had gathered less than $2 million each by that time, following other fund providers such as IndexIQ and Jefferies that had also been liquidating funds late last year.
Investors still holding on to shares of any of the funds on Oct. 26 will receive a cash distribution equal to the net asset value of those shares, and they will not be responsible for any fees other than brokerage fees and expenses. Global X will bear all costs associated with the liquidation process.
Global X is the 19th-largest ETF provider in the U.S., with some $1.46 billion in total assets under management split among 40 ETFs.