Seventeen new names joined ETF Deathwatch this month, but the overall membership roll dropped by five as 13 members died and nine left due to improved health. The current count stands at 325 (233 ETFs and 92 ETNs). The number of actively managed funds on the list declined from 41 to 39.
All newly launched products are granted an exclusion from ETF Deathwatch for the first six months of their life. This gives them an opportunity to attract investor interest either in the form of sufficient assets to achieve profitability or enough trading activity to spur asset growth in future months. For September, the 149 new products launched between March 1 and August 31 are excluded. This leaves 1,619 eligible ETFs and ETNs.
From a percentage viewpoint, ETFs have lower representation on Deathwatch than ETNs. Within the ETF classification, passively managed funds are currently faring better than actively managed ones. The overall ETF representation comes in at 16.3% of the eligible funds, with 14.8% of the 1,307 eligible passively managed funds and 32.0% of the 122 eligible actively managed ETFs on the list. Even though the quantity of listed ETNs has shrunk by more than 10% this year, nearly half of their remaining population is on Deathwatch. For September, 48.4% of the 190 eligible ETNs are on the list.
Day traders have been migrating from 2X to 3X leveraged ETFs to get the biggest bang for their buck. As a result, 2X funds are falling out of favor, and four more of them were added to ETF Deathwatch this month. Six of the other September additions are from sponsors with little or no name recognition among retail ETF investors. ETFs from Arrow, EGShares, Greenhaven, KraneShares, Lattice, and Sit are new members.
BlackRock closed 18 of its iShares ETFs in August. Twelve of these closed ETFs make up the bulk of the ETFs that came off of Deathwatch this month. Perhaps what is more interesting is the fact that six of the iShares ETF closures were not on Deathwatch. For example, iShares FTSE China (FCHI) had more than $37 million in assets and iShares MSCI Emerging Markets Eastern Europe (ESR) had nearly $31 million, keeping them both off the list.
The current criteria for ETF Deathwatch states that funds with more than $25 million in assets are automatically removed from the list. So far this year, eleven products with more than $25 million in assets have closed. It may be time to raise that threshold.
The average asset level of products on ETF Deathwatch held steady at $6.8 million, and the quantity of products with less than $2 million also remained constant at 62. The average age increased from 49.7 to 50.1 months, and the number of products more than five years old was unchanged at 110.
Here is the Complete List of 325 Products on ETF Deathwatch for September 2015 compiled using the objective ETF Deathwatch Criteria.
The 17 ETPs added to ETF Deathwatch for September:
- Arrow QVM Equity Factor (QVM)
- Direxion Daily Basic Materials Bull 3x (MATL)
- EGShares Brazil Infrastructure (BRXX)
- ETRACS CMCI Silver TR ETN (USV)
- Greenhaven Coal Fund (TONS)
- Guggenheim S&P High Income Infrastructure (GHII)
- iPath US Treasury Flattener ETN (FLAT)
- KraneShares FTSE Emerging Markets Plus (KEMP)
- Lattice Emerging Markets Strategy (ROAM)
- ProShares Russell 2000 Dividend Growers (SMDV)
- ProShares S&P MidCap 400 Dividend Aristocrats (REGL)
- ProShares Ultra Gold Miners (GDXX)
- ProShares Ultra Junior Miners (GDJJ)
- ProShares UltraShort Gold Miners (GDXS)
- ProShares UltraShort Junior Miners (GDJS)
- RevenueShares Global Growth Fund (RGRO)
- Sit Rising Rate ETF (RISE)
The 9 ETPs removed from ETF Deathwatch due to improved health:
- Columbia Large Cap Growth (RPX)
- PowerShares KBW Capital Markets (KBWC)
- PowerShares KBW Insurance (KBWI)
- ProShares Short FTSE China 50 (YXI)
- ProShares Ultra S&P Regional Banking (KRU)
- ProShares UltraShort Technology (REW)
- QuantShares U.S. Market Neutral Anti-Beta (BTAL)
- SPDR BofA Merrill Lynch Emerging Markets Corp Bond (EMCD)
- SPDR S&P International Consumer Discretionary (IPD)
The 13 ETPs removed from ETF Deathwatch due to delisting:
- AdvisorShares Accuvest Global Long Short (AGLS)
- iShares Asia Developed Real Estate (IFAS)
- iShares Financials Bond (MONY)
- iShares Industrials Bond (ENGN)
- iShares MSCI All Country Asia Information Technology (AAIT)
- iShares MSCI All Country Asia x-Japan SmallCap (AXJS)
- iShares MSCI Australia Small-Cap (EWAS)
- iShares MSCI Canada Small-Cap (EWCS)
- iShares MSCI Emerging Markets Growth (EGRW)
- iShares MSCI Emerging Markets EMEA (EEME)
- iShares MSCI Emerging Markets Consumer Discretionary (EMDI)
- iShares MSCI Emerging Markets Energy Sector (EMEY)
- iShares MSCI Singapore Small-Cap (EWSS)
Disclosure covering writer: No positions in any of the securities mentioned. No positions in any of the companies or ETF sponsors mentioned. No income, revenue, or other compensation (either directly or indirectly) received from, or on behalf of, any of the companies or ETF sponsors mentioned.