A Video Game ETF Heads For Closure | ETF Trends

This year has brought significant proliferation in the universe of ETFs dedicated to e-sports and video games. That also means competition in that niche has increased in a big way and increased competition can lead to fund closures.

The Defiance Next Gen Video Gaming ETF (VIDG) will be closed later this month, meaning the fund lasted about six months on the market.

“The VIDG ETF seeks to capitalize on a wide range of possible outcomes. Its portfolio reflects the full range of potential winners, from eSports and video games specialists, to media companies and hardware producers,” according to Defiance ETFs.

VIDG will be shuttered on Dec. 27.

The Final Days

VIDG’s “last day of trading will be 26 December 2019, which will also be the final day for creation unit orders by authorized participants,” according to a statement. “The Fund will begin liquidating its portfolio assets on or about December 2, 2019, which will cause the Fund to increase its cash holdings and deviate from the investment objective and strategies stated in the Fund’s prospectus. The Fund will conclude operations and distribute the remaining proceeds to shareholders promptly after 27 December, 2019.”

VIDG debuted in June as a replacement for the Defiance Future Tech ETF (AUGR). In both iterations, the fund is up almost 24% year-to-date while VIDG has gained about 8% since coming to market.

“Shareholders who do not sell their Fund shares by this date will have their shares automatically redeemed for cash based on the Fund’s net asset value (NAV),” according to the statement.

Other video game ETFs include the Global X Video Games & Esports ETF (NASDAQ: HERO), the newest member of the fray,  Roundhill BITKRAFT Esports & Digital Entertainment ETF (NERD) and the VanEck Video Gaming and Esports ETF (ESPO).

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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.