For the month of March, the ETF Deathwatch increased in size. Twenty-four exchange-traded products (“ETPs”) were added to the list, and 18 funds were removed. Of the removals, eight were removed due to improved health and 10 were due to asset managers closing their funds. The high number of fund additions in March may have been investors seeking more “core holdings” rather than niche products, since the fears of a global economic slowdown have been escalating since the volatile market in late 2018.
For March, the additions were a mix of equity and bond ETFs. All of the additions this month were due to low average daily volume rather than low assets. It is possible that these additions may have enough AUM to keep them from closure; however, our system takes into account both AUM and volume, so it’s likely that should volume and interest remain low, these funds may be considered for closure.
For the last few months, emerging-market funds have been added; international troubles continued in March and a few more were added: seven emerging-market funds and six international and ex-US funds. With most being niche products for niche sectors, it makes sense for these funds to show up on the Deathwatch in a period like this. Despite most having positive performance in the month of March, investors are starting to seek out more of a defensive portfolio. This month’s additions are considered more aggressive holdings, while economic data points toward the contrary. A lot of signals have been flashing that the global economy is in the late-stage cycle, contributing to a low trading volume.
There are 45 ETFs and ETNs on Deathwatch this month that have been in the market for more than 10 years. This is a long time for ETPs to exist while remaining on our Deathwatch list. Leveraged and short ETF instruments, as well as a fair number of commodity ETPs, dominate our list of funds older than 10 years. It’s possible that the fund companies managing these products will allow them to remain active, as they play a part in a larger role for their clients that are interested in active management.
The average asset level of the threatened ETFs on ETF Deathwatch slightly decreased from $7.39 million to $7.33 million, and 36 products had less than $2 million in assets. The average age of products on the list decreased slightly from 48.33 months to 47.91 months, and the number of products more than 5 years of age remained at 117. The largest ETF on the list had an AUM of $24.86 million, while the smallest had assets of just $322,070.
Here is the Complete List of 429 ETFs and ETNs on ETF Deathwatch for March 2019 compiled using the objective ETF Deathwatch Criteria.
The 24 ETF/ETNs added to ETF Deathwatch for March:
- Invesco BulletShares 2021 USD Emerging Markets Debt ETF (BSAE)
- Invesco BulletShares 2022 USD Emerging Markets Debt ETF (BSBE)
- Invesco BulletShares 2023 USD Emerging Markets Debt ETF (BSCE)
- Invesco BulletShares 2024 USD Emerging Markets Debt ETF (BSDE)
- iPath US Treasury Long Bond Bear ETN (DLBS)
- DB Gold Double Short Exchange Traded Notes (DZZ)
- First Trust Dow 30 Equal Weight ETF (EDOW)
- Invesco S&P Emerging Markets Markets Momentum ETF (EEMO)
- iShares Interest Rate Hedged Emerging Markets Bond ETF (EMBH)
- ProShares Equities For Rising Rates ETF (EQRR)
- First Trust IPOX Europe Equity Opportunities ETF (FPXE)
- Goldman Sachs Access Inflation Protected USD Bond ETF (GTIP)
- Invesco Strategic Developed ex-US Small Company ETF (ISDS)
- Invesco Strategic Developed ex-US ETF (ISDX)
- Invesco Strategic Emerging Markets ETF (ISEM)
- Invesco Strategic US ETF (IUS)
- Invesco Strategic US Small Company ETF (IUSS)
- Innovator Loup Frontier Tech ETF (LOUP)
- KraneShares MSCI One Belt One Road Index ETF (OBOR)
- Impact Shares Sustainable Development Goals Global Equity ETF (SDGA)
- SPDR EURO STOXX Small Cap ETF (SMEZ)
- American Century Diversified Municipal Bond ETF (TAXF)
- Direxion Daily 7-10 Year Treasury Bear 3x Shares (TYO)
- QuantX Dynamic Beta US Equity ETF (XUSA)
The 8 ETF/ETNs removed from ETF Deathwatch due to improved health:
- iShares MSCI Argentina and Global Exposure ETF (AGT)
- Xtrackers MSCI China A Inclusion Equity ETF (ASHX)
- First Trust Dorsey Wright Momentum & Low Volatility ETF (DVOL)
- Xtrackers MSCI Asia Pacific ex Japan Hedged Equity ETF (HAUZ)
- ProShares UltraShort Semiconductors (SSG)
- Direxion Daily 7-10 Year Treasury Bull 3x Shares (TYD)
- iPath Series B S&P 500 VIX Mid-Term Futures ETN (VXZB)
- Columbia EM Core ex-China ETF (XCEM)
The 10 ETFs/ ETN that were closed:
- WisdomTree Brazilian Real Strategy Fund (BZF)
- Legg Mason Developed EX-US Diversified Core ETF (DDBI)
- Legg Mason Emerging Markets Diversified Core ETF (EDBI)
- WisdomTree Europe Domestic Economy Fund (EDOM)
- Madrona International ETF (FWDI)
- Wisdomtree Global SmallCap Dividend Fund (GSD)
- WisdomTree Global Hedged SmallCap Dividend Fund (HGSD)
- SerenityShares Impact ETF (ICAN)
- WisdomTree Japan Hedged Quality Dividend Growth Fund (JHDG)
- Legg Mason US Diversified Core ETF (UDBI)
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