In this episode of “What’s the Risk?” we take a look at the historic performance of the MSCI Russia Index as a lead into a discussion on what happens when an ETF is closed and doing due diligence on any ETFs an investor might use in their portfolio.
ETF closure is probably a small risk, but it can happen for various reasons. In the example of Russia the index providers stopped tracking Russia after the invasion of Ukraine, but ETFs can be shut down and changed at the whim of the manager. A big risk to new ETFs is if they don’t attract enough support from investors.
We look at two cases at Vanguard and Blackrock which show it’s not just small managers who will close or change ETFs without much warning.
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