In a major fund management shakeup, ETF Managers Group has erased the PureFunds name from the exchange-traded fund landscape by rebranding six PureFunds ETFs and closing two others.
As of August 1, the half-dozen ETFs formerly trading under the PureFunds nameplate now trade under the ETFMG name. ETF Managers Group is a white-label company that helps asset managers, financial advisors and others turn their investment ideas into investable exchange-traded products. It also handles operations, compliance and marketing for the funds on its platform.
The shakeup includes PureFunds’ biggest hit, the former PureFunds ISE Cyber Security ETF (HACK), a fund with roughly $1.2 billon in assets that generated tons of buzz when it launched in November 2014.
Two additional funds—the PureFunds ISE Big Data ETF (BIGD) and PureFunds Solactive FinTech ETF (FINQ), which had assets of about $4 million and $1.5 million, respectively—closed on July 31.
In a press statement, ETF Managers Group cited a dispute that arose from a decision in April after HACK’s board of directors voted to cut the fund's management fee from 0.75 percent to 0.60 percent, effective May 1, 2017, as a way to remain cost competitive. PureFunds CEO Andrew Chanin filed a lawsuit against ETF Managers Group challenging the fee reduction. According to the statement, the same court has twice rejected his claims in hearings on the matter.
Chanin couldn't be reached for comment.
The PureFunds website contains the following statement regarding the changing of the guard at the PureFunds products: “ETF Managers Group, LLC and ETF Managers Trust terminated NASDAQ and PureFunds interest in the "PureFunds ETFs". PureFunds has filed suit against ETF Managers Group, LLC, the ETF Managers Trust and their principals, including Samuel Masucci and Barney Karol, Esq. before the Superior Court of New Jersey, Union County to address the termination.”
The name changes involve the following funds (ticker symbols are unchanged):
• PureFunds ISE Cyber Security ETF is now the ETFMG Prime Cyber Security ETF (HACK); assets of $1.5 billion
• PureFunds ISE Mobile Payments ETF is now the ETFMG Prime Mobile Payments ETF (IPAY); assets of $150 million