ETF Deathwatch for October had 22 additions and 26 exits.
Nine of the departing funds were due to improved health, while the other 17 joined the ranks of the “dearly departed.” The membership roll now stands at 457. Fifteen of the closed funds were ETFs as opposed to ETNs, while two of the nine funds that were removed due to improved health were ETNs. ETNs represent a far smaller number of securities in the U.S. than ETFs, indicating that these funds may be somewhat more in vogue, presently. The even balance of ETNs in this month’s removals for delisting and improved health may indicate healthy market activity for more experimental products.
Only two of the 22 new members were significantly young securities, having just come out of the six-month grace period given to all new ETFs. Since they haven’t had a large amount of time to attract investor interest, they still have a good chance of coming off the list down the road; however, 10 of the added securities were older than 5 years, indicating a high likelihood of decreasing interest. All were added to the list due to low trading volume rather than a decrease in AUM. Three of the 22 funds added were ETNs, which is indicative of the riskiness of the securities from a fund company standpoint. These creative securities are not always as popular as initially expected. Four were also leveraged products, possibly indicating that the market is not valuing these securities as highly as the current administration does.
This month, all but one of the eliminated funds had at least a year’s worth of track record with an average of over 4.5 years’ worth of performance, indicating that fund managers are willing to wait much longer for funds to become profitable. The oldest closure was that of the VanEck Vectors Solar Energy ETF, which had more than nine years of history.
Other sponsors seem to be unduly optimistic. There are 35 ETFs and ETNs on Deathwatch this month that have been on the market for more than 10 years. That is a long time to wait for investor interest to kick in. The BLDRS Asia 50 ADR ETF (ADRA) and BLDRS Europe 100 ADR (ADRU) are the most extreme examples still in the list, while seven different products hit the 10-year mark this month, including several Barclays Commodity ETNs, which had net total assets of $17.36 million and low daily volume.
The average asset level of the zombie ETFs on ETF Deathwatch rose from $6.7 million to $7.6 million, and the quantity of products with less than $2 million in assets increased from 119 to 85. The average age rose from 50.8 to 52.2 months, and the number of products more than 5 years of age decreased from 189 to 176. The largest ETF on the list had an AUM of $23.6 million, while the smallest had assets of just $405,000.
Here is the Complete List of 457 ETFs and ETNs on ETF Deathwatch for October 2017 compiled using the objective ETF Deathwatch Criteria.
The 22 ETFs added to ETF Deathwatch for October:
- United States Copper Index Fund (CPER)
- Direxion Daily Industrials Bull 3x Shares (DUSL)
- Xtrackers Eurozone Equity ETF (EURZ)
- VelocityShares 1x Long VSTOXX Futures ETN (EVIX)
- Franklin LibertyQ US Mid Cap Equity ETF (FLQM)
- Franklin LibertyQ US Small Cap Equity ETF (FLQS)
- Xtrackers Germany Equity ETF (GRMY)
- WisdomTree Global SmallCap Dividend Fund (GSD)
- iPath GSCI Total Return Index ETN (GSP)
- SerenityShares Impact ETF (ICAN)
- Janus Detroit Street Trust Janus Henderson Small/Mid Cap Growth Alpha ETF (JSMD)
- Direxion Daily MSCI Mexico Bull 3x Shares (MEXX)
- SPDR MSCI World StrategicFactors ETF (QWLD)
- Hartford Multifactor REIT ETF (RORE)
- iShares Edge MSCI Min Vol USA Small Cap ETF (SMMV)
- PowerShares S&P 500 Value with Momentum Portfolio (SPVM)
- ETF Industry Exposure & Financial Services ETF (TETF)
- Direxion Daily Transportation Bull 3x Shares (TPOR)
- X-Links Crude Oil Shares Covered Call ETN (USOI)
- Direxion Daily Utilities Bull 3x Shares (UTSL)
- VictoryShares Dividend Accelerator ETF (VSDA)
- PowerShares S&P SmallCap Quality Portfolio (XSHQ)
The 17 ETFs removed from ETF Deathwatch due to delisting:
- Global X Guru Activist Index ETF (ACTX)
- Global X FTSE Andean 40 ETF (AND)
- BullMark LatAm Select Leaders ETF (BMLA)
- Global X Brazil Consumer ETF (BRAQ)
- Global X Brazil Mid Cap ETF (BRAZ)
- DB Commodity Double Short Exchange Traded Notes (DEE)
- Global X Guru International Index ETF (GURI)
- AdvisorShares Gartman Gold/Yen ETF (GYEN)
- VanEck Vectors AMT-Free 12-17 Year Intermediate Municipal Index ETF (ITML)
- VanEck Vectors AMT-Free 6-8 Year Municipal Index ETF (ITMS)
- VanEck Vectors Solar Energy ETF (KWT)
- USCF Restaurant Leaders Fund (MENU)
- iPath Long Enhanced MSCI EAFE Index ETN (MFLA)
- Global X Junior MLP ETF (MLPJ)
- Global X Permanent ETF (PERM)
- VanEck Vectors Treasury-Hedged High Yield Bond ETF (THHY)
- USCF ETF Trust – Stock Split Index Fund (TOFR)
The 9 ETFs removed from ETF Deathwatch due to improved health:
- iShares Edge MSCI Multifactor Global ETF (ACWF)
- Xtrackers FTSE Developed ex US Comprehensive Factor ETF (DEEF)
- SPDR S&P Emerging Latin America ETF (GML)
- John Hancock Multifactor Energy ETF (JHME)
- NuShares ESG Large-Cap Value ETF (NULV)
- NuShares ESG Small-Cap ETF (NUSC)
- VanEck Vectors Oil Refiners ETF (CRAK)
- iPath Bloomberg Industrial Metals Subindex Total Return ETN (JJM)
- iPath Bloomberg Nickel Subindex Total Return ETN (JJN)
Looking for more? See our ETF Deathwatch Archives
Disclosure: Author has no positions in any of the securities mentioned and no positions in any of the companies or ETF sponsors mentioned. No income, revenue, or other compensation (either directly or indirectly) is received from, or on behalf of, any of the companies or ETF sponsors mentioned.