ARK Investment Management has launched its first actively managed thematic equity exchange-traded funds (ETFs) – the ARK Industrial Innovation ETF (ARKQ) and the ARK Web x.0 ETF (ARKW).
Each fund is fully transparent and invests in themes focused on technologically enabled disruption covering a wide range of industries including robotics, 3-D printing, cloud computing, and social media.
ARK was founded by Cathie Wood, a pioneer in global thematic investing, which involves building an equity portfolio based on broad macroeconomic themes that are just beginning to upend specific industries or societies. Prior to founding ARK and becoming its chief investment officer, Wood spent twelve years at AllianceBernstein as chief investment officer for thematic portfolios and 18 years at Jennison Associates as chief economist, equity research analyst, portfolio manager and director.
"Technologically enabled innovation is changing the way we live and should be reflected in how we invest," Wood says. "An acceleration in the pace of innovation makes it more challenging for analysts to analyse industries and companies, and for benchmarks to adjust. Our strategy is to find and invest in the companies that are poised to transform economic sectors and the global economy."
ARK's Industrial Innovation ETF (ARKQ) seeks to invest in companies that are revolutionising the industrial world. Companies such as Tesla, Space X and Google are pioneering changes in the way people travel – from daily commutes to international space exploration. Fund holdings are based upon ARK's original research, covering space exploration, autonomous vehicles, 3D printing, robotics, alternative energy sources, energy storage, infrastructure, and innovative materials.
ARK's Web x.0 ETF (ARKW) seeks to invest in companies that are transforming every sector of the economy thanks to Internet-enabled innovation. These changes cut across sectors and are accelerating thanks to social, mobile, and local technological breakthroughs, which are transforming consumer and business behaviour. Among ARK's topics of original research are big data, cloud computing, cryptocurrencies, devices/gateways, digital education, health care, internet of things, the smart grid, and the sharing economy.
"Through active management, we seek to bring balance back to portfolios that have become increasingly benchmark-sensitive," says Wood. "We believe that passive investing may not capitalise on investment opportunities and results created by disruptive innovation. Our active equity ETFs aim to complement more traditional investment strategies."
ARK Investment Management has filed with the Securities and Exchange Commission for two additional funds: ARK Genomic Revolution Multi-Sector ETF (ARKG), and a composite of the three thematic funds (ARKK).