Fiserv’s (FISV) proposed buyout of CheckFree (CKFR) for $4.2 billion has the potential to kill B2B Internet HOLDRs (BHH), which is a type of exchange traded fund (ETF). BHH is part of the original HOLDRs and differs from most ETFs in that its holdings were selected when they were created, explains Jon C. Ogg for 24/7 Wall Street. The holdings for HOLDRs don’t change unless a company closes. HOLDRs also don’t track an index.
The BHH’s holdings were made up of Internet companies that were created during the dot.com era. After the bubble burst and companies went under, BHH is now left with only four holdings. CKFR is by far the largest holding, weighing in at 69%. If the buyout goes through, BHH will have only three holdings. With trades already less than 50,000 shares per day, it looks like the end is near for BHH.
The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.