The ETFs are also closingjust weeks after reaching their three-year anniversary, (Photo:Shutterstock)

(Bloomberg) –Legg Mason Inc., the Baltimore-based investmentmanagement company, plans to close a quarter of its ETFs next month.

The firm is shutting three funds that focus on the U.S.,emerging markets and developed markets outside the U.S. following areview of its product lineup “to ensure it is relevant to investordemand,” the company said in a statement. Together the funds manage$28 million, just 3 percent of assets in Legg Mason's 12 ETFs, anda fraction of the firm's $727 billion.

The ETFs are also closing just weeks after reaching theirthree-year anniversary, the first point at which some institutionalinvestors and brokerage platforms will consider a new fund. LeggMason's decision to close these products suggests it's becomingincreasingly hard for even large asset managers to supportslow-going funds in their quest to make it big in the $3.7 trillionU.S. ETF industry.

“Running an ETF isn't free, and at some point it just becomesbetter to throw in the towel,” said Eric Balchunas, an ETF analystat Bloomberg Intelligence. “These funds just didn't do anything tostick out from the growing number of smart-beta ETFs, they werejust too middle of the road.”

Funds can cost hundreds of thousands of dollars a year to run,prompting issuers to liquidate ones that don't garner assets.Cumulative closures are on pace to cross 1,000 funds in 2019, withother issuers already announcing plans to close a sport sponsorsETF and one that skims social media to choose its stocks.

These are the funds facing liquidation:

• Legg Mason Developed ex-US Diversified Core ETF (Ticker:DDBI)
• Legg Mason Emerging Markets Diversified Core ETF (Ticker:EDBI)
• Legg Mason US Diversified Core ETF (Ticker: UDBI)

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