In a recent announcement, the Roundhill MEME ETF revealed its plans to liquidate next month due to dwindling assets under management. Launched with much hype during the meme-stock craze, the ETF failed to attract significant attention from investors, leading to its closure.

Since its inception in December 2021, the Roundhill MEME ETF has experienced a significant decline in performance. With a fall of 58% over the past two years, the fund struggled to deliver returns to its investors. Assets under management for the ETF have plummeted to less than $3 million, down from a high of $4.75 million in February 2023.

Interestingly, the announcement of the ETF's closure came at a time when it was experiencing one of its best months in terms of performance. In November, the fund rose by 21.8%, reaching $35.64 per share at Wednesday's close, according to FactSet data. This increase in value was driven by strong performances from two of the fund's largest holdings, Coinbase Global Inc., which saw a gain of 17%, and AMC Entertainment Holdings Inc., with a 32.2% increase over the past five days.

The Roundhill MEME ETF tracks the Solactive Roundhill Meme Stock Index, an equal-weighted index consisting of 25 U.S.-listed stocks. The index selection is based on a methodology that heavily considers social-media buzz and short interest, both defining characteristics of the meme-stock craze that gained popularity in 2021.

Investors in the Roundhill MEME ETF can expect to receive cash from the liquidation process on December 14, one day after the last day of trading on December 13. The closure of this ETF marks another high-profile shutdown of a buzzy fund this year, following the liquidation of an exchange-traded fund that tracked Jim Cramer's stock picks.

The meme-stock craze, which originated in January 2021, saw certain stocks favored by online communities like Reddit's Wall Street Bets experience astronomical gains. Notably, GameStop's shares surged from $3 per share to nearly $500 per share before facing trading restrictions. While echoes of this frenzy have occasionally emerged, such as the surge in Bed Bath & Beyond's stock in August 2022, the meme-stock craze has not replicated its initial fervor.