Rafferty Asset Management to close three Direxion ETFs
The board of trustees of the Direxion Shares ETF Trust has decided to liquidate and shut three exchange-traded funds based on the recommendation of Rafferty Asset Management, the trust's adviser.
Due to the funds' inability to attract sufficient investment assets, Rafferty believes they cannot continue to conduct their business and operations in an economically efficient manner. As a result, the board concluded that liquidating and shutting the funds would be in the best interests of the funds and their shareholders.
The trust will close the following funds: Direxion Large Cap Insider Sentiment Shares (INSD), Direxion S&P 1500 DRRC Index Volatility Response Shares (VSPR) and Direxion S&P Latin America 40 DRRC Index Volatility Response Shares (VLAT).
Shares of the funds will stop trading on the NYSE Arca and will no longer be open to purchase by investors, at the close of regular trading on 18 January 2013. Shareholders may sell their holdings in the funds prior to the closing date, and those transactions are subject to customary brokerage charges. Between the closing date and the liquidation date, shareholders may only be able to sell their shares to certain broker-dealers and there is no assurance that there will be a market for the funds during that time period.
On 25 January 2013, the funds will liquidate their assets and distribute cash pro rata to shareholders who have not previously redeemed or exchanged their shares. These payments are taxable and will include any accrued capital gains and dividends. Each fund's net asset value will reflect the costs of closing the fund as calculated on the liquidation date. The funds will close when the distributions are complete.
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