Loyal followers of the Guggenheim Solar ETF (NYSEArca: TAN), of which there are plenty, by now know the case of Hanergy Thin Film Power Group, once TAN’s largest until tumbled 47% in a single Hong Kong trading session in late May.
After that happened, MAC Solar, the provider for TAN’s underlying index, said it would expel Hanergy Thin Film at the close on the date the embattled Chinese solar firm resumes trading. Well, the embattled stock has yet to resume trading, but that is not stopping Guggenheim and MAC Solar from getting it out of TAN. [Solar ETF Sheds a Problem]
Guggenheim was unable to unload its Hanergy stake in the over-the-counter market, reports Chris Dieterich for Barron’s.
As of June 29, the stock was not shown as a member of TAN’s lineup. The Guggenheim China Technology ETF (NYSEArca: CQQQ) and the Guggenheim China All-Cap ETF (NYSEArca: YAO) have also liquidated small stakes in Hanergy, according to Barron’s. This is a stunning fall from grace for Hanergy, which on May 19, accounted for nearly 20% of TAN’s weight. Controversy had been swirling around Hanergy, including the fact that its closely held parent company accounted for nearly two-thirds of last year’s revenue. [Reason for Caution With Solar ETFs]