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BOSTON, Sept. 22, 2022 /PRNewswire/ - John Hancock Investment Management, a company of Manulife Investment Management, announced today that it plans to close and liquidate 10 sector ETFs (funds). The decision reflects how these funds have been used by investors over the past seven years and how sector investing has shifted in the market.
The Board of Trustees of John Hancock Exchange-Traded Fund Trust has determined that the continuation of the funds isn't in the best interest of the funds or their shareholders and decided to close and liquidate the following funds:
John Hancock Multifactor Consumer Discretionary ETF
John Hancock Multifactor Consumer Staples ETF
John Hancock Multifactor Energy ETF
John Hancock Multifactor Financials ETF
John Hancock Multifactor Healthcare ETF
John Hancock Multifactor Industrials ETF
John Hancock Multifactor Materials ETF
John Hancock Multifactor Media and Communications ETF
John Hancock Multifactor Technology ETF
John Hancock Multifactor Utilities ETF
The funds will stop accepting creation orders after the close of business on October 17, 2022, and will cease trading on the NYSE Arca, Inc. (NYSE) at market close on October 24, 2022.
When a fund commences liquidation, it will no longer pursue its stated investment objective or engage in any business activities except for the purposes of selling and converting into cash all of the assets of the fund, paying its liabilities, and distributing its remaining proceeds or assets to shareholders. During this period, each fund is likely to incur a higher tracking error than is typical for the fund. Furthermore, during the time between market close on October 24, 2022, and October 26, 2022 (the liquidation date), shareholders will be unable to dispose of their shares on NYSE Arca. Shareholders who continue to hold shares of a fund on the liquidation date will receive a liquidating distribution with a value equal to their pro rata share of the fund's assets on that date. For additional information on liquidation, shareholders can visit www.jhinvestments.com/etf.
These closures only affect the 10 John Hancock sector ETFs representing approximately 5% of John Hancock's overall ETF assets.1 No other ETFs offered by John Hancock Investment Management are affected by these closures.
In parallel with this announcement, John Hancock Investment Management is also announcing the approval of a new John Hancock U.S. High Dividend ETF (Ticker: JHDV) scheduled to launch later this month. It has also filed an initial registration statement to launch John Hancock International High Dividend ETF later this year.
"We're absolutely committed to the ETF business. It has been a great area of growth for our product line since we launched our first ETF in 2015. In such a competitive market, we're closing these 10 ETFs to put more focus on our existing equity ETFs subadvised by Dimensional Fund Advisors and the newer suite of income-focused ETFs that were more recently launched with Manulife Investment Management," said Steve Deroian, co-head of retail product, John Hancock Investment Management.
With these announcements, John Hancock Investment Management's ETFs will include 9 ETFs with nearly $5 billion in assets under management. The available ETFs include the multifactor equity suite subadvised by Dimensional Fund Advisors and the income-focused ETFs subadvised by Manulife Investment Management.
1 Bloomberg, 8/31/22.
Investing involves risks, including the potential loss of principal. There is no guarantee that a fund's investment strategy will be successful. Foreign investing, especially in emerging markets, has additional risks, such as currency and market volatility and political and social instability. The value of a company's equity securities is subject to change in the company's financial condition and overall market and economic conditions. Quantitative models may not accurately predict future market movements or characteristics, which may negatively impact performance. The stock prices of midsize companies can change more frequently and dramatically than those of large companies. Large company stocks could fall out of favor. Preferred stock dividends are payable only if declared by the issuer's board. Preferred stock may be subject to redemption provisions. Convertible securities generally offer lower interest or dividend yields than nonconvertible fixed-income securities of similar credit quality because of the potential for capital appreciation. The market values of convertible securities tend to decline as interest rates increase and, conversely, to increase as interest rates decline. Warrant prices may be more volatile than the price of the underlying securities and may offer greater potential for capital appreciation as well as capital loss. Warrant holders do not have dividends, voting rights, or rights to the assets of an issuer, and warrants cease to have value if not exercised prior to the expiration date. REITs may decline in value, just like direct ownership of real estate. The use of hedging and derivatives could produce disproportionate gains or losses and may increase costs. It's possible that an active trading market for fund shares will not develop, which may hurt your ability to buy or sell fund shares, particularly in times of market stress. Trading securities actively can increase transaction costs, therefore lowering performance and taxable distributions. Liquidity—the extent to which a security may be sold or a derivative position closed without negatively affecting its market value, if at all—may be impaired by reduced trading volume, heightened volatility, rising interest rates, and other market conditions. A portfolio concentrated in one sector that holds a limited number of securities may fluctuate more than a more broadly diversified fund. Fund distributions generally depend on income from underlying investments and may vary or cease altogether in the future. Shares may trade at a premium or discount to their NAV in the secondary market. These variations may be greater when markets are volatile or subject to unusual conditions. Please see the fund's prospectus for additional risks.
Investors are advised to carefully consider the investment objectives, risks, charges, and expenses of an ETF before investing. The prospectus and summary prospectus contains this and other important information about the ETF and should be read carefully before investing. A copy of the prospectus and summary prospectus for the ETF may be obtained by calling 800-225-6020. Please read the prospectus and summary prospectus carefully before investing.
Registration statements containing a preliminary prospectus (and statement of additional information) relating to the shares of John Hancock U.S. High Dividend ETF and John Hancock International High Dividend ETF have been filed with the Securities and Exchange Commission, but not yet been declared effective. A copy of the preliminary prospectus for each ETF may be obtained by calling 800-225-6020. The information contained in the prospectus (and statement of additional information) is not complete and may be changed. No sales of the shares of John Hancock U.S. High Dividend ETF and John Hancock International High Dividend ETF may be made until the registration statement filed with the Securities and Exchange Commission is effective. This press release is not an offer to sell these securities and is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.
John Hancock ETFs are distributed by Foreside Fund Services, LLC in the United States, and are subadvised by Dimensional Fund Advisors LP or our affiliate Manulife Investment Management (US) LLC. Foreside is not affiliated with John Hancock Investment Management Distributors LLC, Manulife Investment Management (US) LLC, or Dimensional Fund Advisors LP.
Shares of the ETF are not redeemable with the ETF other than in creation unit aggregations. Instead, investors must buy or sell the ETF shares in the secondary market at market price (not NAV) through a broker-dealer. In doing so, the investor may incur brokerage commissions and may pay more than net asset value when buying and may receive less than net asset value when selling.
Statements in this press release that are not historical facts are forward-looking statements as defined by the United States securities laws. You should exercise caution in interpreting and relying on forward-looking statements because they are subject to uncertainties and other factors which are, in some cases, beyond the ETF's control and could cause actual results to differ materially from those set forth in the forward-looking statements.
About John Hancock Investment Management
A company of Manulife Investment Management, we serve investors through a unique multimanager approach, complementing our extensive in-house capabilities with an unrivaled network of specialized asset managers, backed by some of the most rigorous investment oversight in the industry. The result is a diverse lineup of time-tested investments from a premier asset manager with a heritage of financial stewardship.
About Manulife Investment Management
Manulife Investment Management is the global brand for the global wealth and asset management segment of Manulife Financial Corporation. We draw on more than a century of financial stewardship and the full resources of our parent company to serve individuals, institutions, and retirement plan members worldwide. Headquartered in Toronto, our leading capabilities in public and private markets are strengthened by an investment footprint that spans 19 geographies. We complement these capabilities by providing access to a network of unaffiliated asset managers from around the world. We're committed to investing responsibly across our businesses. We develop innovative global frameworks for sustainable investing, collaboratively engage with companies in our securities portfolios, and maintain a high standard of stewardship where we own and operate assets, and we believe in supporting financial well-being through our workplace retirement plans. Today, plan sponsors around the world rely on our retirement plan administration and investment expertise to help their employees plan for, save for, and live a better retirement. Not all offerings are available in all jurisdictions. For additional information, please visit manulifeim.com.
Manulife, Manulife Investment Management, Stylized M Design, and Manulife Investment Management & Stylized M Design are trademarks of The Manufacturers Life Insurance Company and are used by it, and by its affiliates under license.
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