The ARK Web x.0 ETF (NYSEArca: ARKW) is a fine idea for investors looking to access a basket of disruptive technology names with the benefit of the battle-tested active management team. These days, however, ARKW is known for having one of the largest weights to Tesla (NASDAQ: TSLA) among all ETFs.
Back in 2018, ARKW was also known for a large weight to bitcoin via the Grayscale Bitcoin Trust (OTC:GBTC). Proving the benefits of active management under the right circumstances, the ARK Invest team significantly pared its GBTC stake before bitcoin’s now infamous late 2018 slide.
“Today, GBTC is one of the ARK ETF’s 42 holdings, representing just 1.86% of the fund’s weight. ARKW is, however, actively managed so it’s not constrained by an index and can adjust its bitcoin exposure as its managers see fit,” according to InvestorPlace.
Building The Bitcoin Benefit
Bitcoin and other cryptocurrencies have experienced another year of wide oscillations, but major investors and financial players continue to keep their fingers on the pulse of the developing, digital currency market.
One of the main issues with releasing a Bitcoin ETF is the regulatory issues surrounding it. Regulators are spooked by the potential for criminal activity as cryptos become a potentially more potent force in the currency world. Owning the digital assets via a fund such as ARKW ameliorates some of those concerns. Plus, some market observers remain enthusiastic about the cryptocurrency’s price appreciation prospects.
“As an open, neutral, and permissionless global monetary system with no reliance on the State, bitcoin is in a good position to win this battle,” said ARK in a recent research piece. “If it does, ARK believes the result will be measured in trillions, more than an order of magnitude higher than its $150 billion network value today.”
Including its significant Tesla exposure, ARKK touches many other corners of the emerging technological universe.
Disruptive technology is not relegated to certain sectors as it will permeate into all industries in some form or fashion. For example, augmented reality is technology comprised of digital images superimposed over the real world, and its use is primed to drive industry growth–industries like real estate and manufacturing are already putting the technology to use in a variety of ways.
On Tuesday, ARKW jumped 4.06% on more than triple the average daily volume, vaulting its year-to-date gain to almost 19%.
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.