While it appeared as though the year of closures was finally
over for the ETF world, it now looks as though one more big wave
is due to hit the market on this front, this time courtesy of
PowerShares. One of the dominant players in the industry, the
Chicagoland-based firm revealed plans to shut down 13
ETFs
from its lineup thus reducing its total below the 120 fund
mark.
The impacted ETFs includes the
following products
:
|
Dynamic Insurance Portfolio (
PIC
)
|
|
Morningstar StockInvestor Core Portfolio (
PYH
)
|
|
Dynamic Banking Portfolio (
PJB
)
|
|
Global Steel Portfolio (
PSTL
)
|
|
Active Low Duration Portfolio (
PLK
)
|
|
Global Wind energy Portfolio (
PWND
)
|
|
Active Mega Cap Portfolio (
PMA
)
|
|
Global Nuclear Energy Portfolio (
PKN
)
|
|
Ibbotson Alternative Completion Portfolio (
PTO
)
|
|
RiverFront Tactical Balanced Growth Portfolio (
PAO
)
|
|
RiverFront Tactical Growth & Income Portfolio (
PCA
)
|
|
Convertible Securities Portfolio (
CVRT
)
|
The vast majority of the aforementioned products never really
caught on or were unable to fight past a first mover advantage
and were relegated to 'me too' status. As a result, the baker's
dozen of ETFs represents less than 1% of PowerShares total AUM,
so it is unlikely to impact the bottom line too much, and instead
may actually improve it by getting rid of some of the likely loss
producing funds (also see
PowerShares Slashes Fees on Six ETFs
).
For example, a few on the list, such as PSTL, PMA, PPLK, PTO,
PWND, and CVRT, had less than $10 million in assets each and were
thus generating meager revenues for the firm. Still, some were
relatively unique, the cheaper option in the space, or were solid
performers, so it is undoubtedly a loss for investors overall
even if they weren't being taken advantage of for the time
being.
If you are currently an investor in any of the aforementioned
products, it is worth noting that the final day of trading for
the group will be on February 26
th
, so investors definitely have some time before the shut down
takes place. For those who do not sell by February 26
th
, they will receive a cash payment equal to the NAV of their
shares, inclusive of capital gains and dividends by the
liquidation date of March 7
th
, 2013 (read
4 Best New ETFs of 2012
).
There are direct competitors to pretty much every one of the
above listed ETFs so it shouldn't be too hard to find a
replacement product that offers similar exposure. Still, let us
hope that with the end of 2012 in sight that it also marks the
conclusion of the record stretch of ETF closures as well.
Want the latest recommendations from Zacks Investment
Research? Today, you can download
7 Best Stocks for the Next 30 Days
.
Click to get this free report >>
Follow
@Eric
Dutram
on Twitter
PWRSH-CONV SEC (CVRT): ETF Research Reports
PWRSH-RF T BG (PAO): ETF Research Reports
PWRSH-RF T G&I (PCA): ETF Research
Reports
PWRSH-DYN INSUR (PIC): ETF Research Reports
PWRSH-DYN BKG (PJB): ETF Research Reports
PWRSH-GLB NUCLR (PKN): ETF Research Reports
PWRSH-AC LOW DR (PLK): ETF Research Reports
PWRSH-AC MEG-CP (PMA): ETF Research Reports
PWRSH-GLB STEEL (PSTL): ETF Research Reports
PWRSH-IB ALTCMP (PTO): ETF Research Reports
PWRSH-ND GL WND (PWND): ETF Research Reports
PWRSH-MS STKINV (PYH): ETF Research Reports
To read this article on Zacks.com click here.
Zacks Investment
Research
Want the latest recommendations from Zacks
Investment Research? Today, you can download 7 Best Stocks for
the Next 30 Days. Click to get this free report