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iShares to Shut Down 18 ETFs - ETF News And Commentary

Zacks Equity Research

iShares, the biggest issuer of ETFs, has planned to shut down 18 funds from its lineup. The closures reflect a lack of interest in these products in an investment world with more than 1,700 U.S. listed ETFs.


The products to be closed have a combined AUM of $227 million and will be liquidated by August 21.  All these funds are quite unpopular, as all have AUMs of under $50 million. Among the ones to be closed iShares FTSE China (FCHI) is the most popular with an asset base of $36.3 million, followed by iShares MSCI EM Eastern Europe (ESR) with an AUM of $29.2 million (read: Should You Short China ETFs Despite Rate Cuts?).


Most of the products to be closed down offer exposure to international stocks. Some of these include iShares MSCI AC Asia ex Japan Sm Cap (AXJS), iShares MSCI Australia Small Cap (EWAS), iShares MSCI Canada Small Cap (EWCS), iShares MSCI Hong Kong Small Cap (EWHS) and iShares MSCI Singapore Small Cap (EWSS).


Others with an international focus are iShares MSCI Emerging Markets EMEA (EEME), iShares MSCI Emerging Markets Growth (EGRW) and iShares MSCI Emerging Markets Value (EVAL) (read: 5 Top Performing Country ETFs of 1H).


Apart from these, the issuer has also planned to shut down some sector specific funds including iShares MSCI AC Asia Info Technology (AAIT), iShares MSCI EM Cons. Discretionary (EMDI), iShares MSCI EM Energy Capped (EMEY), iShares Asia Developed Real Estate (IFAS) and iShares North America Real Estate (IFNA).


iShares Financials Bond (MONY), iShares Industrials Bond (ENGN) and iShares Utilities Bond (AMPS) are the three debt funds which will also face shutdown.


The above closures will shrink the offerings of iShares by about 6% to 299, according to XTF, as mentioned in an article by Barron’s. BlackRock – the parent company of iShares – said that the decision was “based on an ongoing process to review its product lineup and ensure it meets the evolving needs of its clients” (read: ProShares to Shutdown 17 Leveraged and Inverse ETFs).


The closures clearly highlight the survival of the fittest funds and a healthy process to eliminate the unpopular and unwanted funds. In fact, the ETF industry recently witnessed its 500th closure of ETFs and ETNs. Nonetheless, even following the 18-fund closure, iShares will still have a large number of U.S. listed ETFs under its umbrella, with iShares Core S&P 500 ETF (IVV) being the most popular with an asset base of $68.7 billion.


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ISHARS-F CHINA (FCHI): ETF Research Reports
 
ISHARS-MS AU SC (EWAS): ETF Research Reports
 
ISHARS-SP500 (IVV): ETF Research Reports
 
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