Guggenheim Investments will liquidate nine exchange-traded funds (ETFs) that failed to garner much interest from investors.
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The last day of trading for the below listed ETFs is expected to be on Friday, March 15, 2013:
1. (ABCS) Guggenheim ABC High Dividend
2. (EWEF) Guggenheim MSCI EAFE Equal Weight
3. (EWMD) Guggenheim S&P MidCap 400® Equal Weight
4. (EWSM) Guggenheim S&P SmallCap 600® Equal Weight
5. (FAA) Guggenheim Airline
6. (RSU) Guggenheim 2x S&P 500
7. (RSW) Guggenheim Inverse 2x S&P 500
8. (WFVK) Wilshire 5000 Total Market
9. (WXSP) Wilshire 4500 Completion
The average size of the nine closing ETFs is $16 million, for a total of $144 million. That figure represents roughly 1% of Guggenheim Investments' total $13.7 billion1 in exchange-traded assets as of January 31, 2013.
"Guggenheim remains committed to the ETF business, and this evolution is a natural and necessary part of the process to ensure we are meeting our clients' needs," said William Belden, managing director and head of product development. "We are dedicated to providing high quality investment solutions for our clients and our product development pipeline is positioned well to deliver unique ETF products," he continued. "Since January 1, 2012 through February 1, 2013, our equity and fixed-income ETF assets have increased $4.12 billion or 55%."
The last day of trading and the final date for creation and redemption activity for the nine liquidating ETFs is expected to be Friday, March 15, 2013. The ETFs will then be delisted from NYSE Arca prior to the start of trading on Monday, March 18, 2013. After being delisted and prior to the liquidation of the ETFs on or about Friday, March 22, 2012, shareholders will not be able to purchase or redeem shares from the ETFs or purchase or sell them in the secondary market. Between the delisting date and the liquidation date, the affected Funds will be in the process of liquidating portfolio assets.
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Shareholders remaining in the affected ETFs as of close of business Thursday, March 21, 2013 will have their shares liquidated as of that date's closing net asset value. The liquidation proceeds will be distributed on or about the following day, Friday, March 22, 2013. Liquidation proceeds will include any accrued capital gains and dividends. Shareholders remaining in the ETFs through March 22, 2013 will not be charged any transaction fees by the ETFs for the distribution of the final Fund proceeds. The net asset value of each affected ETF on Thursday, March 21, 2013 will reflect expenses encountered in closing the ETF.
The ETF liquidations will allow the company to "focus resources on products that have demonstrated the most marketplace demand," said the company in a press release.
Guggenheim Investments is the investment management division of Guggenheim Partners.
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