Direxion funds is closing a total of nine leveraged and inverse exchange-traded funds September 5 because they haven't attracted enough assets, the company has announced.
The decision was announced this month, about the same time that Scottrade said it decided to close 15 FocusShare ETFs and Russell Investments said it's cutting back on its ETF business. The board of trustees of Direxion Shares ETF Trust made the decision based on a recommendation from Rafferty Asset Management, the trust's advisor, the board announced in a press release.
The funds being closed are leveraged and inverse ETFs -- the bull funds seek three times the performance of their underlying index while the bear funds see 300% of the opposite of their index's performance. The funds are:
Direxion Daily Agribusiness Bull 3X Shares (COWL),
Direxion Daily Agribusiness Bear 3X Shares (COWS),
Direxion Daily Basic Materials Bear 3X Shares (MATS),
Direxion Daily BRIC Bull 3X Shares (BRIL),
Direxion Daily BRIC Bear 3X Shares (BRIS),
Direxion Daily Healthcare Bear 3X Shares (SICK),
Direxion Daily India Bear 3X Shares (INDZ),
Direxion Daily Latin America Bear 3X Shares (LHB), and
Direxion Daily Retail Bear 3X Shares (RETS).
Shares of the ETFs will stop trading on the NYSE Arca and will no longer be open to purchases at the close of regular trading on September 5. On September 12, 2012, the funds will liquidate their assets and distribute cash pro rata to shareholders who have not previously redeemed or exchanged their shares.