With deep exposure to the artificial intelligence (AI) and robotics themes, the ARK Innovation ETF (NYSEArca: ARKK) puts investors at the epicenter of seismic economic and technological shifts, including disruption in the healthcare arena.
“Companies within ARKK include those that rely on or benefit from the development of new products or services, technological improvements and advancements in scientific research relating to the areas of DNA technologies (‘’Genomic Revolution’), industrial innovation in energy, automation, and manufacturing (‘Industrial Innovation’), the increased use of shared technology, infrastructure and services (‘’Next Generation Internet’), and technologies that make financial services more efficient (‘Fintech Innovation’),” according to ARK Invest.
The use of robotics in healthcare was already well underway, but the introduction of Covid-19 only accelerated the need for robots administering care amid social distancing precautions. Research shows that even after the pandemic comes to pass, the future of medical robotics shows great promise.
“Robotics are increasingly being considered synonymous with progress within multiple industries. Healthcare robotics have been specifically developed to improve patient outcomes,” according to Market Research. “Healthcare robotics vary, as there are multiple ways they can be used in a healthcare setting. The industry is expanding with the adoption of automation across all areas. Surgical robotic systems are a paragon of robotics in the Medtech industry.”
ARKK Arrives
ARKK, now the largest equity-based actively managed ETF by assets, has a compelling runway for long-term growth with AI and robotics as major drivers of the fund’s broader opportunity set.
The rise of robots during the pandemic was apparent in countries like China, the original epicenter of the virus, where robots were used to treat patients in place of doctors in order to curb the number of coronavirus cases. As more global economies start to open their doors, it will be robots that will continue to thrive, which makes the case for robotics-focused exchange-traded funds (ETFs).
In the healthcare space, robotics “systems are used to perform minimally invasive procedures in order to alleviate the burden of open surgery for patients,” notes Market Research. “Robotics also encompasses an aspect of artificial intelligence (AI), specifically cloud computing, which is used to convert real-world data into meaningful patterns through analysis. Similarly, care robotics are heavily utilized in the industry, as they decrease the burden of care on physicians and improve patient outcomes.”
ARKK aims to capture long-term alpha+ with a low correlation of relative returns to traditional growth strategies and negative correlation to value strategies.
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The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.