AMP (ASX:AMP) shuts down ETFs

Not enough people are interested, so AMP Capital and Betashares are liquidating the funds. Here's the lowdown on these three ETFs.

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AMP Limited (ASX: AMP) is decommissioning its entire range of exchange-traded funds (ETFs).

The company announced to the ASX on Wednesday that the following ETFs would be shut down, with their last day of trading on 4 December.

  • AMP Capital Global Infr Sec Fund (Unhedged) (ASX: GLIN)
  • AMP Capital Dynamic Markets Fund (Hedge Fund) (ASX: DMKT)
  • AMP Capital Global Prop Sec Fund (Unhedged) (ASX: RENT)

AMP Capital partners with Betashares to operate the funds. 

It seems these ETFs just failed to attract enough investor interest in the four years of their existence.

"BetaShares and AMP Capital have decided to terminate AMP Capital's three Active ETF funds due to the lack of scale achieved," an AMP Capital spokesperson said.

"Rationalisation of our funds is a normal part of our business. AMP Capital regularly reviews its product set to ensure products remain competitive and they meet the ongoing needs of investors."

At the time of writing on Thursday, the AMP share price is down 0.9% to $1.65.

Has AMP given up on ETFs?

The AMP Capital spokesperson said the company realises ETFs are "a large and growing market segment".

"While we have made the decision to terminate the Active ETFs, we may launch new Active ETFs in the future should the conditions be right and there is strong investor interest."

But for now, customers who wished to buy into these ETFs could instead invest in their unlisted equivalents, according to the spokesperson:

  • AMP Capital Global Property Securities Fund 
  • AMP Capital Global Infrastructure Securities Fund 
  • AMP Capital Dynamic Markets Fund

What to do if you own shares of these ETFs

AMP offered two choices for shareholders of the three ETFs.

First choice is they could simply sell off their shares via the ASX on or before 4 December.

The alternative is to hold onto their shares and participate in the wind up process. This will result in a final distribution payment that includes a final dividend plus a split of the liquidated assets.

"It is important to note that investors who hold their units and participate in the fund's winding up will be subject to market movements until the fund's assets have been realised."

Betashares and AMP expect that wind-up shareholders will receive their final distribution amount by the end of the year.

Motley Fool contributor Tony Yoo has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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