Earlier this month, ARK Investment Management launched the ARK Transparency ETF (CTRU), an ETF that focuses on investing in some of the most transparent companies globally, on the Cboe BZX Exchange, per the press release. ARK believes that transparency leads to less friction for companies and thereby provides the opportunity for greater growth.
CTRU seeks to correspond to the Transparency Index, an index that follows the 100 most transparent companies based on a proprietary scoring methodology utilized by Transparency, LLC, the index provider. The index is equally weighted and rebalanced on a quarterly basis.
“ARK believes that transparency serves as a catalyst for innovation and positive change, enhancing the performance of companies while benefiting the well-being of all,” said Cathie Wood, CEO, CIO, and founder of ARK in the press release. “Transparency implies openness, communication, accountability, and trust, and should be a cornerstone of modern society and business. Given our own belief in the value of transparency, we were impressed by the methodology developed by Transparency, LLC to determine the most transparent companies in the world and we are excited to bring this truly innovative fund to the market!”
The underlying index is designed to measure transparency for companies based on a variety of factors, including their adoption of transparency standards, product and services disclosures, involvement in legal proceedings, and reputation. The index is exclusionary of the following industries: alcohol, banking, chemicals, confectionary, fossil fuel transportation, gambling, metals, mineral, natural gas, oil, and tobacco.
“Transparency is a core tenet of Cboe’s guiding principles. We are pleased to collaborate with like-minded partners – ARK and Transparency Invest– to list this truly innovative ETF on our exchange and help drive positive impact for market participants,” said Laura Morrison, global head of listings at Cboe Global Markets.
As of October 31, the index was heavily concentrated in information technology at 49.34%, followed by consumer discretionary at 19.65%, and industrials at 10.02%, with several smaller allocations.
CTRU carries an expense ratio of 0.55% and has 100 holdings.
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