ARK Investment Management, the New York-based money manager that recently entered the exchange traded funds arena, expanded its lineup of unique actively managed ETFs Friday with the debut of two new funds.
The ARK Genomic Revolution Multi-Sector Fund (NYSEArca: ARKG) is ARK’s spin on a health care ETF, though this new ETF is anything but your grandfather’s health care fund. Indeed, ARKG is home to some familiar pharmaceuticals and biotechnology stocks.
ARKG’s largest holding is an almost 7.4% weight to Illumina (NasdaqGS: ILMN) and other top-10 holdings include medical devices giant Thermo Fisher Scientific (NYSE: TMO), Novartis (NYSE: NVS) and Bayer (OTC: BAYRY), two of the world’s largest pharma companies.
However, ARKG is a substantial departure from the health care ETF most investors are accustomed to.
“Securities within ARKG are substantially focused on and are expected to substantially benefit from extending and enhancing the quality of human and other life by incorporating technological and scientific developments, improvements and advancements in genomics into their business. One such way this is accomplished is by offering new products or services that rely on genomic sequencing, analysis, synthesis or instrumentation,” according to ARK.
Said another way, ARKG is the rare ETF with a health care tilt that features stocks such as Google (NasdaqGS: GOOG), Amazon (NasdaqGS: AMZN) and Monsanto (NYSE: MON) among its holdings.
The ARK Innovation Fund (NYSEArca: ARKK) is ARK’s other new offering. That new ETF packages the concepts found in ARKG, the ARK Industrial Innovation ETF (NYSEArca: ARKQ) and the ARK Web x.0 ETF (NYSEArca: ARKW), which were the firm’s first ETFs. ARKQ and ARKW debuted at the end of September. [ARK’s Game-Changing ETFs]
The ARK Innovation Fund “seeks to invest in the cornerstone companies included in the other three thematic funds (ARKQ, ARKW and ARKG) that further the fund’s focus on investing in disruptive innovation. Such companies may include ones that benefit from big data, cloud computing, cryptocurrencies, the sharing economy, genomic sequencing, molecular medicine, agricultural biology, 3D printing, energy storage, and autonomous vehicles,” according to a statement issued by ARK Investment Management.
ARKK is home to nearly 50 stocks, including scores of familiar names such as Tesla (NasdaqGS: TSLA), Google, Facebook (NasdaqGS: FB), Twitter (NYSE: TWTR), Apple (NasdaqGS: AAPL) and Alibaba (NYSE: BABA).
“Our composite fund is a product of our approach to active management and can bring balance back to portfolios that have become increasingly benchmark-sensitive. Pulling across industries including life sciences, robotics, energy storage, social media, and cloud computing, ARKK will hold some of the most dynamic and innovative companies in the world,” Cathie Wood, founder and CEO of ARK Investment Management, in the statement.
Although all four ARK ETFs are equity-based actively managed funds, the firm is fully transparent when it comes to providing investors access to holdings on a daily basis. For example, the holdings for ARKQ and ARKW, the older pair of ARK’s four ETFs, are current as of Oct. 30.
That says that contrary to the belief of some fund managers that want to see actively managed non-transparent ETFs come to market, it is in fact possible to effectively run an actively managed ETF that engages in daily disclosure of its equity positions. [SEC Rejects Non-Transparent Active ETF Applications]
All four ARK ETFs charge 0.95% per year.
ETF Trends editorial team contributed to this post. Tom Lydon’s clients own shares of Apple, Facebook, Google and Tesla.