What to Do If an ETF in Your Portfolio Closes

Typically this will only happen if you buy “unique” ETFs, i.e., not those that track the S&P 500 or another large index, according to Jackson. If it happens to you, here’s what to do.

You’ll get a notice from the fund manager if one of your ETFs is closing, “listing dates when it will stop trading and when its assets will be liquidated.” Then you’ll have two choices: You can sell, or wait for liquidation.

An ETF in Your Portfolio Closes

Selling is simple; you can trade shares normally until the date the fund closes, and you should try to sell before the last day the fund is trading. The other option, which is riskier, is to wait for the managers to liquidate the fund. In this case, you may walk away with less than what the ETF was trading previously, though ETF.com notes that “even if you fall asleep at the wheel, you will receive the fair value of your shares” most of the time.

To read the original content written by Alicia Adamczyk – Click here!

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