Old Mutual, the South Africa-based money manager, said it was closing all five of its U.S. exchange-traded funds, saying the competitive reality of the U.S. market, coupled with the prolonged market volatility, made gaining market share unlikely.

“Given the structure of the U.S. ETF market and prolonged volatile market, we've decided that it's unlikely our products will gain sufficient market share in the United States,” Tendai Musikavanhu, chief executive officer of Old Mutual Global Index Trackers, said in a press release.

Old Mutual’s exit is the latest in a spate of ETF closings that has put the industry on pace to shutter at least 40 funds by the end of 2010. Grail Advisors closed two of its actively managed ETFs last month, Claymore shut down four on Sept. 10, Geary Advisors shuttered its two-ETF operation this month and Javelin will shut its Sharia-focused Islamic fund next month.

Despite continued closings, as Matt Hougan wrote in his recent blog “Industry Should Close 200 More ETFs,” the rate of fund closings is slower than it was in 2008 or 2009, when sponsors pulled 58 and 56 ETFs off the market, respectively.

According to research from Morgan Stanley Smith Barney’s economics team, 118 U.S.-listed ETFs have shut down since the end of 2007 through June 30. Although 121 ETFs have been launched in 2010, there have also been 23 liquidations, meaning net new issuance of ETFs this year has been 98 funds through the end of the second quarter. The note said the pace of liquidations has slowed from 44 in 2008 and 51 in 2009.

The ETFs Old Mutual is closing are:

• the GlobalShares FTSE All-World Fund (NYSEArca: GSW)
• the GlobalShares FTSE Emerging Markets Fund (NYSEArca: GSR)
• the GlobalShares FTSE All-Cap Asia Pacific ex Japan Fund (NYSEArca: GSZ)
• the GlobalShares FTSE All-World ex US Fund (NYSEArca: GSO)
• the GlobalShares FTSE Developed Countries ex US Fund (NYSEArca: GSD)

Trading in the ETFs will be suspended prior to the market opening on Oct. 6, and shareholders will receive the net asset value of their shares as of Oct. 8, the company said.

“The U.S. ETF market was a new distribution channel for our well-established South African indexation business. We will continue using our core business of segregated account index management as a springboard for growth into other distribution channels and markets," Musikavanhu said in the prepared statement.

Old Mutual Global Index Trackers is part of Old Mutual Plc, a South Africa firm founded in 1845 that provides life assurance, asset management, banking and general insurance in Europe, the Americas, Africa and Asia.