Last Thursday (7/23/2009), XShares Advisors announced intentions to close and liquidate the AirShares EU Carbon Allowance Fund (ASO) effective July 31, 2009. The fund has already begun the liquidation process, so the price of ASO will not likely track its indicative value this week. Shareholders must therefore use extra caution when trying to exit any positions. Checking quotes a few times today revealed a bid size of only 100 shares, so be sure to use a limit order when trying to sell.
Launched just a little over seven months ago, ASO becomes the 117th exchange-traded product (ETFs and ETNs) to be delisted from US exchanges. It was added to my ETF Deathwatch list earlier this month, which happened to be the first time it was eligible.
XShares has not had much luck in the ETF space. Their Adelante Real Estate shares were liquidated a year ago (7/24/08), their HealthShares were liquidated in two waves (9/19/2008 and 12/23/2008), and two of their five TDX Independence funds are on ETF Deathwatch.
I’ve commented before that the typical US investor does not understand what European Union ECX Carbon Financial Instrument Futures Contracts are, the primary holding of ASO. There is another similar product on the market, iPath Barclays Capital Global Carbon Index Total Return (NYSEARCA:GRN), but it too is on ETF Deathwatch, having failed to attract any investor interest since its launch in June of last year.
If you are interested in learning more about carbon trading, then you should probably download the “Transforming Climate Change Through the Capital Markets: Carbon as a Commodity” report on the XShares website before they take it down.
Disclosure: No positions