Direxion said it plans to liquidate three exchange traded funds that have failed to attract sufficient assets, adding to the record number of ETFs that have closed in 2012.
Direxion said it has decided to shutter the trio of funds based on the recommendation of Rafferty Asset Management, the advisor to the ETFs.
The three funds closing are Direxion Large Cap Insider Sentiment Shares (NYSEArca: INSD), Direxion S&P 1500 DRRC Index Volatility Response Shares (NYSEArca: VSPR) and Direxion S&P Latin America 40 DRRC Index Volatility Response Shares (NYSEArca: VLAT).
Next month, the funds will liquidate their assets and distribute cash to shareholders who have not previously redeemed or exchanged their shares, according to a press release.
So far this year, 98 exchange traded products have been delisted, according to XTF.
ETF closures are “a natural part of the weeding-out process that will continue as the industry matures,” said Morningstar analyst Robert Goldsborough. [Why ETF Closures are a Good Thing for Investors]