Recent market moves may prove that the financial services industry of the future is going to be radically different from that of the past. Consumers are increasingly relying on technology to conduct businesses and go about their daily lives — a shift that we believe is only going to accelerate.
In the upcoming webcast, The Future of Finance: How Fintech Could Disrupt Everything, Maximilian Friedrich, Analyst, ARK Invest; George Whitridge, Analyst, ARK Invest; and Matt Murphy, Vice President, National ETF Sales, Resolute Investment Managers, will dig into the up-and-coming financial technology industry and look for pockets of opportunity in a rapidly changing market.
For instance, ARK Invest has come out with the ARK Fintech Innovation ETF (ARKF) to help ETF investors capitalize on the burgeoning fintech industry that provides innovative financial solutions in a digital age.
ARKF invests in equity securities of companies that ARK believes are shifting financial services and economic transactions to technology infrastructure platforms, ultimately revolutionizing financial services by creating simplicity and accessibility while driving down costs.
A company considered to be engaged in the theme of Fintech innovation if it derives a significant portion of its revenue or market value from the theme of Fintech innovation, or it has stated its primary business to be in products and services focused on the theme of Fintech innovation, according to ARK Invest.
Additionally, “Fintech innovation” is defined as the introduction of a technologically enabled new product or service that can potentially alter the way the financial sector works, which includes: Transaction Innovations, Blockchain Technology, Risk Transformation, Frictionless Funding Platforms, Customer Facing Platforms and New Intermediaries.
ARKF could capture long-term growth with a low correlation of relative returns to traditional growth strategies and negative correlation to value strategies. Based on ARK research, digital wallets could be valued at $800 billion by 2024 or 27x the $29.5 billion today.
Current sector weights include information technology 38.8%, consumer discretionary 20.8%, communication services 20.0%, financials 17.8% and industrials 2.1%. Top holdings include, Square Inc 12.1%, MercadoLibre 5.6%, Apple 4.6%, Zillow 4.6% and Tencent Holdings 4.5%.
Financial advisors who are interested in learning more about the financial technology segment can register for the Thursday, June 18, webcast here.