Another ETF Player Retires its Funds But Stays in the Game
Reported by Neil Anderson, Managing Editor
The market downturn has claimed six more ETFs, but those funds' advisor is still keeping the door to the ETF universe open. On Monday SPA ETFs revealed that its six MarketGrader ETFs -- SPA MarketGrader 40 Fund, SPA MarketGrader 100 Fund, SPA MarketGrader 200 Fund, SPA MarketGrader Small Cap 100 Fund, SPA MarketGrader Mid Cap 100 Fund and SPA MarketGrader Large Cap 100 Fund -- will stop trading on March 25 and liquidate by the 30th. Though the funds represented SPA's entire ETF lineup, SPA itself plans to stick around.
"In light of the current market environment keeping the SPA MarketGrader Funds open would compromise investors and increase costs," stated Daniel Freedman, managing director. "However, the SPA ETF Trust remains open and we plan to partner with other institutions to bring new ETFs to market in Europe and the US in 2009. Additionally, when market conditions improve we may reintroduce the MarketGrader strategy."
SPA isn't the only firm to exit the ETF business in recent months. Ziegler Capital Management pulled the plug on its NYSE Arca Tech 100 ETF in December, and Northern Trust liquidated its ETFs in February (see MFWire, 11/25/2008 and 1/27/2009).
A spokeswoman for SPA declined to comment on the specifics of any new ETFs SPA might launch, but she confirmed that SPA's ETFs held $10.4 million in total as of Friday.
New York-headquartered SPA is affiliated with London & Capital.
NEW YORK, NY--(Marketwire - March 16, 2009) - SPA ETFs announced today the scheduled closing of the SPA MarketGrader ETFs and the last day of trading will be March 25, 2009. The decision was made by the Board of Trustees in consultation with SPA ETFs, Inc., the investment advisor to the Funds. The Board determined current market conditions are unsuitable for a long-only equity investment strategy, such as the one employed by the SPA MarketGrader ETFs. Closing the Funds was decided to be in the best interest of the Funds' shareholders.
The SPA ETF Trust will remain open and SPA ETFs, Inc. seeks to list new ETFs in 2009.
"In light of the current market environment keeping the SPA MarketGrader Funds open would compromise investors and increase costs," said Daniel Freedman, Managing Director of SPA ETFs, "However, the SPA ETF Trust remains open and we plan to partner with other institutions to bring new ETFs to market in Europe and the US in 2009. Additionally, when market conditions improve we may reintroduce the MarketGrader strategy."
All six SPA MarketGrader ETFs will be affected. They include:
SPA MARKETGRADER 40 FUND (SFV)
SPA MARKETGRADER 100 FUND (SIH)
SPA MARKETGRADER 200 FUND (SNB)
SPA MARKETGRADER SMALL CAP 100 FUND (SSK)
SPA MARKETGRADER MID CAP 100 FUND (SVD)
SPA MARKETGRADER LARGE CAP 100 FUND (SZG)
March 25, 2009 will be the last day of trading in the Funds on NYSE Arca, Inc. ("NYSE Arca"). NYSE Arca will halt trading in the Funds before the open of trading on March 26, 2009. The Funds will officially close to new investment on March 25, 2009.
From March 26, 2009 through March 30, 2009, the Funds will be in the process of closing down and liquidating their portfolios. This process will result in the Funds not tracking their underlying indexes and their cash holdings increasing, which may not be consistent with the Funds' investment objectives and strategies.
Thus, the ex date will be on March 26, 2009 and the record date on March 30, 2009. The cash proceeds will be payable on or after March 31, 2009.
Shareholders may sell their holdings prior to March 25, 2009, incurring a transaction fee from their broker-dealer. From March 26, 2009 through March 30, 2009, shareholders may be able to sell their shares to certain broker-dealers, but there can be no assurance that there will be a market for the Funds. All shareholders remaining on March 30, 2009 will receive cash at the net asset value of their shares as of March 30, 2009 which will include any capital gains and dividends into the cash portion of their brokerage accounts.
For more information shareholders can call 877-SPA-ETF1 (877-772-3831) or email email@example.com.
About SPA ETFs, Inc.
SPA ETFs, Inc. is an independent provider of Exchange Traded Funds (ETFs). SPA has listed ETFs on NYSE Arca, LSE, Borsa Italiana and Euronext Lisbon. SPA ETFs serves as a global partner to institutions interested in developing and listing white label ETFs.
SPA ETFs Inc., investment adviser to the US domiciled SPA ETFs, is affiliated with London & Capital, an independent firm of investment advisors and fund managers, with services including investment expertise, research, quantitative analysis and regulatory authorizations Additional information is available at www.spa-etf.com.
Foreside Fund Services, LLC, distributor to the US domiciled SPA ETFs