After experiencing outflows for months, fortunes for the ARK Innovation ETF (NYSEArca: ARKK) reversed in February, with ARK Invest’s flagship fund seeing $411.3 million in inflows during the month. ARK Invest’s CEO and CIO Cathie Wood told CNBC’s “Capital Connection” that the firm has seen “significant inflows” since Jan. 17.
“Given our expectations for growth in these new technologies, I think we’re going to see some spectacular returns,” Wood added.
Eric Balchunas, Bloomberg Intelligence senior ETF analyst, speculated that ARK’s flagship fund is now seeing money come in partially because of Wood’s conviction and in part due to the price being right and investors buying into the dip.
“ARK will be around for a long time. You can depend on Cathie Wood’s stock picks,” he said, noting that if Wood were to switch to cash or value stocks, she’d lose all her investors.
Balchunas added: “Even people who don’t admire her stock picks are finding it appealing to buy her basket of ARK stocks at this price. She’s smart to stick to her guns. Love it or hate it, it’s dependable.”
ARKK is an actively managed ETF that invests at least 65% of its assets in companies relevant to the investment theme of disruptive innovation. ARK defines ‘‘disruptive innovation’’ as introducing a technologically enabled new product or service that potentially changes the way the world works. This includes companies 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 and the “genomic revolution;” automation, robotics, and energy storage; Artificial Intelligence and the “Next Generation Internet;” and fintech innovation.
ARKK has an expense ratio of 0.75%.
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