Toronto-based Fidelity Investments Canada ULC announced on Thursday that it’s closing 11 target-date funds early in the new year due to lack of investor demand.
The funds being closed include Fidelity Income Replacement 2017 Portfolio, as well as Fidelity Income Replacement Portfolios for the years 2019, 2021, 2023, 2025, 2027, 2029, 2031, 2033, 2035 and 2037.
Interest in these funds has been low since their launch in January 2008, Fidelity says in a media release. The funds will be closed on Feb. 19, 2016.
Investors in the closing income replacement portfolios, also known as life cycle funds, will be able to switch into other Fidelity mutual funds or redeem their funds for cash prior to the closing date.
Investors who don’t switch or redeem voluntarily before Feb. 19 will have their securities automatically redeemed if they are held outside a Fidelity registered account, or switched to Fidelity Canadian Money Market Fund if they are held in a Fidelity registered account.
Fidelity will waive any deferred sales charges or short-term trading fees payable to the firm in connection with voluntary redemptions made before Feb. 19 or automatic redemptions made after that date.
Fidelity Income Replacement Portfolios were designed to convert retirement savings into a reliable stream of monthly cash flow payments for a defined period of time until each fund’s target date. The 11 portfolios are each made up of differing allocations in 10 underlying Fidelity funds. It was originally intended that the funds would pay out the portfolio value at the fund’s target date.
Fidelity also announced that it will be merging Fidelity American Opportunities Fund into Fidelity American Equity and Fidelity American Opportunities Class into Fidelity American Equity Class on Feb. 19, 2016.