The BetaShares Nasdaq 100 ETF (ASX: NDQ) is one popular example. However, many ASX investors have funds ranging from the BetaShares Global Cybersecurity ETF (ASX: HACK) to the BetaShares Australia 200 ETF (ASX: A200) as well.

But if you're a fan of the ASX ETFs provided by Betashares, this might be difficult news to read.

Yesterday, Betashares announced that it would be closing no fewer than nine of its exchange-traded fund products. In all cases, investors have until mid to late January or early February to decide whether to sell out of their existing units. Otherwise, they will be redeemed for cash when the funds are formally wound up.

ETF closures are quite rare events on the ASX. With the passive ETF industry receiving seemingly endless additional inflows every year, it's far more common to see new funds open up rather than existing ones closed down.

Nine ETFs: Rule them out in 2024

Yet not all ETFs have proven to be a hit with ASX investors, and as such, many are uneconomical to run long term. This seems to be the fate that has befallen nine Betashares ETFs.

Here are the nine funds Betashares has announced will shut up shop early next year:

• BetaShares Online Retail and E-Commerce ETF (ASX: IBUY)
• BetaShares Metaverse ETF (ASX: MTAV)
• BetaShares Future of Payments ETF (ASX: IPAY)
• BetaShares Future of Food ETF (ASX: IEAT)
• BetaShares Solar ETF (ASX: TANN)
• BetaShares Digital Health and Telemedicine ETF (ASX: EDOC)
• BetaShares Martin Currie Equity Income Fund (ASX: EINC)
• BetaShares Martin Currie Emerging Markets Fund (ASX: EMMG)
• BetaShares Martin Currie Real Income Fund (ASX: RINC)

It seems that the reason for all nine of these ETFs' impending closure is the same: money. Here's how Betashares has justified its decision to wind up these funds:

The decision to close the Fund recognises that, since its launch, it has not achieved sufficient scale to be sustainable and is not likely to do so.

Why are these nine ETFs leaving the ASX?

Funds management is a business that is all about scale. Investors are usually unwilling to entrust their cash to an ETF if it charges a high management fee, say north of 1%, for argument's sake. That means a fund with $10 million in assets under management will only produce an income stream worth $50,000 a year if it has a fee of 0.5%.

As such, funds have to hit tens of millions of dollars in assets under management for them to be considered a viable product.

Let's take the Betashares Future of Food ETF as a case study. Right now, Betashares tells us that this particular fund has just $2.32 million in assets under management. Since IEAT charges a fee of 0.67%, Betashares would be making approximately $15,544 in annual revenues from this fund right now

So you can see why it's probably not worth the providers' while to keep IEAT's doors open, even if it has returned a respectable 16.5% over the 12 months to 29 November.

Let's see what Betashares' next ETFs look like.

The post Big news: BetaShares to close 9 ASX ETFs appeared first on The Motley Fool Australia.

An ETF's dividend yield is dictated by the payments from their underlying holdings. If the businesses inside the ETF collectively have good dividend yields, then the ETF's yield should also be appealing too.

There aren't many ASX ETFs paying dividend yields above 5%, but below are four that do have relatively high yields.

Vanguard Australian Shares High Yield ETF (ASX: VHY)

The concept of this fund is that it provides low-cost exposure to companies on the ASX with higher forecast dividend yields than other ASX shares.

Diversification is achieved by restricting the proportion invested in any one industry to 40% of the total ETF and 10% in any one company.

It has a total of 71 holdings, with significant positions in companies like Commonwealth Bank of Australia (ASX: CBA), BHP Group Ltd (ASX: BHP), National Australia Bank Ltd (ASX: NAB), Wesfarmers Ltd (ASX: WES) and Westpac Banking Corp (ASX: WBC). It gives a lot of exposure to the ASX's blue-chip shares.

According to the latest Vanguard monthly update, the VHY ETF has an annual management fee of 0.25% and a grossed-up dividend yield of 6.5%.

Australian Top 20 Equity Yield Maximiser Fund (ASX: YMAX)

This fund owns 20 of the largest ASX blue-chip shares, providing quarterly income to investors. It also employs a 'covered call' strategy to enhance dividend income and "partly offset potential losses in falling markets" according to Betashares.

Four companies in the YMAX ETF portfolio have a weighting of at least 7%: BHP (15.4%), CBA (13.6%), CSL Ltd (ASX: CSL) (9.5%), and NAB (7.4%).

This fund has a higher management fee of 0.76% than the VHY ETF, though it also has an even higher grossed-up dividend yield of 9.8%.

Betashares Martin Currie Equity Income Fund (ASX: EINC)

This ASX ETF invests in an actively managed portfolio focused on ASX shares with good income attributes. It aims to provide a stronger dividend yield than the S&P/ASX 200 Index (ASX: XJO) and grow income faster than the rate of inflation.

The fund, managed by Martin Currie, selects "quality Australian companies paying attractive income, and with the potential for long-term income growth."

It currently has names like APA Group (ASX: APA), Medibank Private Ltd (ASX: MPL), Telstra Group Ltd (ASX: TLS) and Atlas Arteria Group (ASX: ALX) in the portfolio.

Australian Bank Senior Floating Rate Bond ETF (ASX: QPON)

This ASX ETF invests in a portfolio of some of the largest and most liquid senior floating rate bonds issued by ASX bank shares. In other words, it invests in some of the safest bonds Aussie banks have issued, with their yield linked to interest rates.

If the RBA interest rate increases, the income yield rises. However, if the RBA interest rate falls, so does the income payment.

The income is paid monthly and, according to Betashares, is "expected to exceed the income paid on cash and short-dated term deposits."

The biggest eight bond positions all have a weighting of more than 8%, and those large positions are bonds from ANZ, Westpac, NAB and CBA.

According to BetaShares, the current 'all-in' yield is 5.1%. This ETF has an annual management fee of 0.22%.

The post 4 ASX ETFs with yields over 5% appeared first on The Motley Fool Australia.