ARK Invest ETFs have been the center of media attention and drama so far in 2021. ARK Invest, founded by Cathie Wood in 2014, has been under the microscope after having a standout year following the pandemic. Today I am focusing specifically on one ARK Invest ETF, the ARK Innovation ETF (ARKK -3.27%). Over the past year, ARKK has returned investors a whopping 48.75% versus Invesco QQQ ETF's (QQQ -1.45%) spectacular 36.63%. Even after a rough start to 2021, ARKK has outperformed QQQ by over 12%. The question investors have is whether this was solely fueled by the pandemic. If you zoom out and look at three-year returns, ARKK is up over 177% versus 108% for QQQ. That's 69% outperformance in three years.
ARKK is an actively managed ETF with an expense ratio of .75%. ARK Invest makes daily buys and sells and shares this information publicly. Although the transparency is great, I believe many investors use this data incorrectly. I see people post on social media and websites worried about what ARK Invest bought or sold the day before. The goal of ARKK is to invest in "disruptive innovation" over the long term. Cathie Wood has been very vocal in explaining that the fund invests with the goal of multiyear holdings, capturing gains from secular growth trends and disruptive technology.
ARKK invests in the following themes:
- Genomic revolution
- Industrial innovation
- Next-generation internet
- Fintech innovation
In today's video I break down ARKK. I provide a list of its current holdings, opinions on why the ETF has underperformed YTD, my thoughts on its long-term growth prospects, and technical analysis on where the price could be headed.
*Stock prices used in the below video were during the trading day of August 5, 2021. The video was published on August 5, 2021.