On Friday May 13 ARKK rose nearly 12% bringing its YTD return to -53.9% according to Lipper. That’s still substantially worse than the -45% reported by the WSJ in this earlier excerpt. I will no longer be updating the return here as I’ve done now for several weeks. However, you can check the performance at Lipper
. Thanks for reading my post.
(Extended excerpt) Cathie Wood’s ARK Innovation exchange-traded fund keeps falling, but investors aren’t jumping ship. Shares of the popular ETF, which is known by its ticker ARKK, have declined 45% so far in 2022—including 21% in April alone—as rising interest rates punish stocks that are valued on the prospect of robust future growth. Those are just the type of companies that ARKK targets through its investment theme of “disruptive innovation.”Its big holdings include Tesla Inc., Zoom Video Communications Inc., Roku Inc., Teladoc Health Inc. and Coinbase Global Inc. With the exception of Tesla, those stocks have all fallen more than 35% this year. The S&P 500 has dropped 10% over the same period, while the tech-heavy Nasdaq Composite has retreated 18%.
Ms. Wood and her fund shot to prominence in 2020, when its shares soared nearly 150% as the Federal Reserve slashed interest rates to near zero and investors loaded up on risk. The S&P 500, by comparison, rose 16% that year. Since then, it has been tough going. While the S&P 500 gained 27% in 2021, ARKK shares slumped 24%, stung as rising government bond yields prompted a flight from high-growth stocks. The downdraft has continued this year as the fund sticks to its strategy of buying and holding companies it believes offer the greatest potential for innovation. Many of them haven’t yet achieved consistent profitability. Despite the drawdown, investors haven’t fled ARKK. Instead, they have funneled more than $658 million into the fund this year, according to FactSet data through Thursday, including about $59 million in the latest week. That is even as investors yanked $2.3 billion year-to-date from the Invesco QQQ Trust, a prominent ETF tracking the Nasdaq-100 index … From
: The Wall Street Journal
April 25, 2022
Article was published Monday morning. So numbers are a couple days out of date. I also wonder about the conclusion here that money hasn’t fled. My hunch is that a lot fled and a lot of new money has raced in hoping to buy near bottom. Other thoughts welcome.