August ETF Launches, Filings and Closings

All of the ETF Happenings in August 2016

etf closings

The summer is typically a slower time in the financial world and ETF world. August is usually the lightest of the three months in terms of activity due to "vacation season". However, even despite some seasonality, there was a fair share of new ETFs and some filings as well. There were more closings than usual for this time of year, so things weren't inactive as expected.

In total, we saw the launch of 10 ETFs as well as 14 funds filed with the SEC (Securities Exchange Commission).

We did lose a few funds twenty to be exact, which was spread among three ETF providers.

New Exchange Traded Funds and Notes That Started Trading in August 2016

Here are details about each of the new launches so you can begin your research.

     BTEC - Principal Health C are Innovators Index ETF

The Principal Healthcare Innovators Index ETF (BTEC) seeks to provide investment results that closely correspond, before expenses, to the performance of the NASDAQ U.S. Healthcare Innovators Index. The ETF employs a passive investment approach designed to track the performance of the Index, which is a NASDAQ-licensed index based on Principal’s intellectual property (IP). Principal retains ownership of the index IP under the licensing agreement. The NASDAQ U.S. Healthcare Innovators Index is designed to provide exposure to U.S. companies that are early stage healthcare companies.

     EUFS - Direxion Daily European Financials Bear 1X Shares ETF

The Direxion Daily European Financials Bear 1x Shares seeks daily investment results, before fees and expenses, of 100% of the inverse of the performance of the MSCI Europe Financials Index. 

The MSCI Europe Financials Index is provided by MSCI Inc. and is a free float-adjusted, market capitalization weighted index and represents securities of large capitalization and mid-capitalization companies across developed market countries in Europe.

As of June 30, 2016, the Index consisted of 98 constituents with an average market capitalization of $16.16 billion and a median market capitalization of $10.51 billion

     FINQ - Pure Funds Solactive Fin Tech ETF 

The fundamental purpose of the FinTech disruption is to ask how amassing data, user platforms and aggregating service providers can enhance financial services for the consumer. Aiming to increase client options while achieving efficiency-based cost compression, FinTech challenges status-quo actors with innovative applications of technology. On a fundamental level, the consumer experience in the financial services sector has remained unchanged for hundreds of years. FinTech proposes tech-based solutions for the modern economy and investor. The PureFunds Solactive FinTech ETF: FINQ, was created to provide the market with a transparent vehicle to invest in the technology space disrupting the financial sector. The Fund seeks to provide investment results that, before fees and expenses, correspond generally to the price and yield performance of the Solactive FinTech Index.

  GENY - Principal Millennials Index ETF

This fund seeks to provide investment results that closely correspond, before expenses, to the performance of the Nasdaq Global Millennial Opportunity Index (the "index").

Under normal circumstances, the ETF invests at least 80% of its net assets, plus any borrowings for investment purposes, in equity securities of companies that compose the index at the time of purchase. The index is designed to provide exposure to global equity securities of companies that are impacted by the spending and lifestyle activities of the Millennial generation, which refers to people born from 1980 to the mid-2000s.

     HDMV - First Trust Horizon Managed Volatility Developed International ETF

The First Trust Horizon Managed Volatility Developed International ETF is an actively managed exchange-traded fund. The Fund's investment objective is to provide capital appreciation. Under normal market conditions, the Fund will seek to achieve its investment objective by investing at least 80 percent of its net assets (including investment borrowings) in common stocks and depositary receipts of developed market companies listed and traded on non-U.S.

exchanges that Horizon Investments, LLC believes exhibit low future expected volatility.

     HUSV - First Trust Horizon Managed Volatility Domestic ETF

The First Trust Horizon Managed Volatility Domestic ETF is an actively managed exchange-traded fund. The Fund's investment objective is to provide capital appreciation. Under normal market conditions, the Fund will seek to achieve its investment objective by investing at least 80 percent of its net assets (including investment borrowings) in common stocks of domestic companies listed and traded on U.S. national securities exchanges that Horizon Investments, LLC believes exhibit low future expected volatility.

     IMED - Pure Funds ETFx HealthTech ETF

The Pure Funds ETFx Health Tech ETF: IMED, was created to provide the market with a transparent vehicle to invest in the growing intersection of the technology and health care industries. The Fund seeks to provide investment results that, before fees and expenses, correspond generally to the price and yield performance of the ETFx Health Tech Index.

    MLPE - C-Tracks ETNs on the Miller Howard MLP Fundamental Index, Series B, Due July 13, 2026 ETF

The C-Tracks Exchange-Traded Notes Based on the Performance of the Miller/Howard MLP Fundamental Index (the “Index”), which we refer to as the “C-Tracks”, are unsecured debt securities issued by Citigroup Inc. The C-Tracks are designed for investors who seek exposure to the performance of the Index and any distributions that may be paid on the securities included in the Index, reduced by an accrued investor fee as described below. The Index is a rules-based proprietary index developed by Miller/Howard Investments, Inc., designed to measure the performance of 25 master limited partnerships (“MLPs”) selected by a methodology based upon quantitative fundamental factors of publicly traded MLPs. The methodology tracked by the Index (the “Methodology”) is intended to provide exposure to a target basket of 25 MLPs selected using certain quantitative fundamental factors of MLPs, including distribution growth, estimated capital expenditures, and distribution coverage. The Methodology aims to achieve this through a quarterly, rules-based selection of MLPs to be included in the Index for the following quarter based on certain observable fundamental factors. 

     PMPT - iSectors Post MPT Growth ETF

This fund seeks growth of capital, with a secondary emphasis on capital preservation, independent of individual market conditions. The fund is a "fund of funds" that seeks to achieve its investment objective by using an objective and quantitative algorithm based on Post-Modern Portfolio Theory to allocate assets across various asset classes and/or sectors of the U.S. securities markets. While the fund may invest directly in equity or fixed income securities, the Sub-Adviser will generally implement its strategy by investing in ETFs, including, without limitation, leveraged ETFs, to gain exposure to the foregoing asset classes.

     WTRX - Summit Water Infrastructure Multifactor ETF

The Summit Water Infrastructure Multifactor Exchange Traded Fund (NYSE Arca: WTRX) delivers exposure to the Summit Zacks Global Water Index (NYSE: ZAXWTRX), which tracks the performance of publicly listed U.S. and international companies with a significant portion of their business activities dedicated to the global water industry. The Index utilizes a transparent, rules-based methodology to incorporate fundamental factors that have been strong historical indicators of the long-term performance of water equities. The Index is comprised of approximately 30 to 50 equities selected from a stringently defined universe of global water companies, and is rebalanced on a quarterly basis to incorporate the latest financial data into the screening process. The Index methodology was designed by Summit Water Capital Advisors, the index creator, in conjunction with Zacks Index Services, the index provider, through rigorous testing to determine the Three-Factor Model most relevant to company valuation and profitability in the global water industry.

With this full list of new ETPs, you may be able to find a fund (or exchange traded note) to help you with your investing strategy, or maybe just a good fit for your portfolio.

Before you make any trade, make sure you research each fund individually. Watch how they react to different market conditions. And consider talking to your broker or a financial professional if you have any questions or need any advice. keep in mind, these are new funds, so they don't have much in the way of historical data.

No investment is without risk, so make sure you understand the impact of any ETF or your financial strategy or your portfolio. However, once you conduct your due diligence, hopefully, you can accomplish some of your investing goals with the above ETFs.

List of ETFs and ETNs That Closed or Redeemed in August 2016  

Moving on, I want to talk about some of the ETFs that are no longer on the market. As mentioned above, we lost 20 funds and the firms behind the delistings were Accushares, State Street Global Advisors, and Etracs.

  • OILD - Accu Shares S&P GSCI Crude Oil Excess Return Down Shares ETF
  • OILU - Accu Shares S&P GSCI Crude Oil Excess Return Up Shares ETF
  • VXUP - Accu Shares Spot CBOE VIX Up Shares ETF
  • VXDN - Accu Shares Spot CBOE VIX Down Shares ETF
  • DVHI - Etracs Diversified High Income ETN
  • MLPW - Etracs Wells Fargo MLP Index ETN
  • RWXL - Etracs Monthly Pay 2X Leveraged Dow Jones International Real Estate ETN
  • FMLP - Etracs Wells Fargo MLP Ex Energy ETN
  • BABS - SPDR Nuveen Barclays Build America Bond ETF
  • BIK - SPDR S&P BRIC 40 ETF
  • CXA - SPDR Nuveen Barclays California Municipal Bond ETF
  • EMBB - SPDR MSCI EM Beyond BRIC ETF
  • EMCD - SPDR Bank of America Merrill Lynch Emerging Markets Corporate Bond ETF
  • EMTF - SPDR MSCI EM 50 ETF
  • IJNK - SPDR Barclays International High Yield Bond ETF
  • INY - SPDR Nuveen Barclays New York Municipal Bond ETF
  • JPP - SPDR Russell Nomura PRIME Japan ETF
  • JSC - SPDR Russell Nomura Small Cap Japan ETF
  • MDD - SPDR S&P International Mid Cap ETF
  • RORO - SPDR SSgA Risk Aware ETF

As you can see, 12 of the funds and notes were SPDRs, and we had four from Etracs and four from Accushares as well. And the most common reason for the closings of the majority of these products was lack of assets and investor interest. Which unfortunately is part of the game. 

If you have never been through a liquidation process or an exchange traded product closing, then you may want to read this piece and learn how it all works: What happens when an ETF closes its doors?

Now you can be prepared with this news in order to make any adjustments to your portfolio or strategies. 

List of Funds That Were Filed in August 2016

Moving on from closings to filings, we had 14 new concepts registered with the Securities Exchange Commission. A few of which already have a symbol.

  • ACSI - American Customer Satisfaction Index ETF
  • DAVS - Davis Focused US Equity ETF
  • DSWO - Davis Select World Opportunities ETF
  • DSFE - Davis Select Financial ETF
  • LVHE - Legg Mason Emerging Markets Low Volatility High Dividend ETF
  • Global X MSCI SuperDividend EAFE ETF
  • iShares MSCI USA ESG Optimized ETF
  • iShares 5-10 Year USD Bond ETF
  • Pacer US Cash Cows 100 ETF
  • Serenity Shares Core U.S. ETF
  • Serenity Shares Core Multi-Asset ETF
  • Serenity Shares Impact ETF
  • USCF Restaurant Leaders Fund
  • Wisdom Tree Dynamic Currency Hedged International Quality Dividend Growth Fund

Three of the funds (each having symbols) were from Davis, who are a new ETF provider. And we had a few from Serenity Shares as well. And of course, we had funds from the usual suspects such as iShares and Wisdom Tree. And once any/all of these go live, I'll be sure to update you on this website, so check back often.

List of Funds That Changed Their Names and Benchmarks in June 2016

The last thing to catch up on is a fund that changed their names, their underlying benchmarks or both...

  • EMDD - Emerging Global Advisors' EGShares EM Strategic Opportunities ETF is now  EMSO - Emerging Global Advisors' EGShares EM Strategic Opportunities ETF 

Please be aware that the funds and notes on these lists, or any fund or note, have their risks. As do all investments. Make sure you research each fund thoroughly before making any trades (short or long), to replace any of these products in your portfolio.

If you do have suitable replacement assets, be sure to watch how the replacement funds (or notes) react to different market conditions. Understand what is in each fund. And if you have any questions or concerns about any of the ETFs or ETNs you are considering, be sure to consult a financial professional such broker or your financial advisor. 

However, once you have completed your due diligence, then good luck with all of your trades. Hopefully, your portfolio was not too impacted by these closings, and you are able to find replacements or even improvements.

Disclaimer: At the time of publication of this article, I do not have any open positions in any of the exchange traded products (notes or funds) on any of the lists provided above - Mark Kennedy