Many investors have noticed (or perhaps imagined) that, when a stock wins the fancy of the financial press, it has often peaked in value and is more likely than not in for a rough run. Could that rule of thumb apply to ETFs, too? In recent weeks there have been a spate of articles hyping ETFs and even a handful wondering if there are too many ETFs for investors to choose from. Now, at least one fund advisor seems to agree (that there are too many, that is).

Friday SSgA Funds Management officials said that they are pulling the plug on their SPDR(R) O-Strip ETF. The move -- which may signify the ETFs are a maturing industry -- marks one of the first (if not the first) times that an exchange-traded fund will be liquidated. The Fund's board of trustees' decision to close the Fund was part of an ongoing business review, according to SSgA officials.

The most likely reason for the move was that the fund had failed to attract enough assets to make it viable. After two years, the fund has just $5 million of assets.

State Street will halt trading in the fund just prior to the opening bell on the American Exchange on September 14, 2006. It will then close down the fund and liquidate the portfolio from September 14, 2006 through September 20, 2006. During the wind-down period the fund may not track its respective index due to its increasing cash holdings and liquidating portfolio securities, warned SSgA officials.

Shareholders of record remaining as of September 20, 2006 will receive cash at the Net Asset Value (NAV) of their shares as of this date which will include any capital gains and dividends as of this date. These shareholders will not incur transaction fees, but the NAV of the Funds will reflect the costs of closing the Fund. Payments to shareholders will be made on September 25, 2006. 

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