More ETFs are being weeded out as the global $2 trillion business matures and consolidates.
A record 117 ETFs have closed in the first half of this year, the Financial Times reports, sourcing data from independent research firm ETFGI. There are nearly 5,000 exchange traded products listed around the globe.
“Part of it is the fact that we had a record amount of ETF launches in the past couple of years,” said Andrew Lo, professor of finance at the MIT Sloan School of Management, in the article.
“Firms are getting rid of products that are not getting to that critical mass or that they think won’t work in the future,” added Deborah Fuhr, managing partner at ETFGI.
Global ETFs have seen year-to-date inflows of $96.3 billion through June, according to BlackRock. However, worries the Federal Reserve may taper its bond purchases led to outflows of $8.2 billion in June. It was the first month of outflows since November 2011.
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