Despite their allure to some investors, exchange-traded funds have failed to attract investors in an all-ETF format for target date funds.
On May 27, Deutsche Asset & Wealth Management liquidated the assets of its X-trackers target date fund series consisting of five all-ETF funds, which represented about $136 million of the company's $17.4 billion in total ETF assets.
(More: Active or passive target date funds have similar returns, Morningstar finds)
“Deutsche AWM aims to be a leading specialty provider of ETFs in the U.S., by providing differentiated and compelling products to investors,” Fiona Barrett, head of passive management, Americas, wrote in an e-mail. “After carefully evaluating multiple factors, we made the decision to liquidate our target date ETF suite, as we believe they did not fit well within our overall strategy.”
Deutsche AWM's departure from the ETF target date fund market reduces to zero the number of all-ETF target date funds.
In October, BlackRock Inc. liquidated the assets of its all-ETF iShares Target Date series, which contained 10 separate all-ETF funds.
(More: Lessons from a walk through the ETF graveyard)
When it announced the closing of the series in August, BlackRock's iShares unit said, in a news release, the decision was “based on ongoing product reviews and client feedback and limited investor interest in the funds.”
Robert Steyer is a reporter at sister publication Pensions & Investments.
