There are areas of the burgeoning disruptive technologies space where investors may want to evaluate active management and genomics is one of those segments. The ARK Genomic Revolution Multi-Sector Fund (CBOE: ARKG) is one of the premier solutions to consider.
ARKG includes companies that merge healthcare with technology and capitalize on the revolution in genomic sequencing. These companies try to better understand how biological information is collected, processed and applied by reducing guesswork and enhancing precision; restructuring health care, agriculture, pharmaceuticals and enhancing our quality of life.
Over its more than five years on the market, there have been numerous examples of ARKG benefiting from stock selection, which is another way of saying the fund has often held positions in some biotechnology names that are lightly represented or not found at all in rival passive products.
Last week brought to two reminders of the ARK Invest team’s stock selection proficiency with ARKG.
Inovio Pharmaceuticals Inc. (INO), which is a coronavirus play, surged 16% last Thursday amid reports more cases of the deadly respiratory illness are emerging in China, but there’s more to this company’s story beyond the coronavirus.
“Recently, the Coalition for Epidemic Preparedness Innovations (CEPI) granted Inovio $9 million in funding to begin a clinical trial for a vaccine to prevent infection from the Wuhan coronavirus (2019-nCoV),” according to ARK. “ARK believes CEPI’s grant highlights the strength of Inovio’s platform in developing novel immunotherapies for both infectious disease and cancer.”
Inovio accounts for 3.21% of ARKG’s weight, making the ETF one of the largest holders on a percentage basis of that stock. But wait. There was more for ARKG last week.
“Pluristem (PSTI) appreciated more than 19% on Friday after the release of its annual shareholder letter,” notes ARK. “Management emphasized that two of its leading Phase III assets surpassed enrollment milestones and that the U.S. Biomedical Advanced Research and Development Authority (BARDA) will respond to its funding proposal for treating Acute Radiation Syndrome (ARS) once the coronavirus outbreak subsides.”
Pluristem is a smaller ARKG holding, but investors won’t find it in many traditional biotechnology ETFs. Sometimes, small holdings, particularly in biotech ETFs, can make big differences. After all, ARKG surged more than 6% last week.
For more on disruptive technologies, visit our Disruptive Technology Channel.
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.