Cathie Wood's ARKK Still Leaking, Loses Over 3% In Value And 2% Of Net Assets In A Week
Portfolio Pulse from Johnny Rice
Cathie Wood's ARK Innovation ETF (ARKK) has experienced a significant outflow, losing over 3% in value and 2% of its net assets in a week. This contrasts sharply with the broader market's performance, exemplified by the SPDR S&P 500 ETF Trust (SPY) which is up 8.5% in the same period. Investors are concerned about Wood's decision to divest from Nvidia (NVDA), which has seen substantial growth. Wood's current focus is on Coinbase (COIN), which has surged over 50% YTD, and Tesla (TSLA), despite its recent struggles. For those betting against ARKK, the AXS Short Innovation Daily ETF (SARK) and for supporters, the AXS 2X Innovation ETF (TARK) are available.
March 20, 2024 | 7:00 pm
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POSITIVE IMPACT
Coinbase (COIN) has surged over 50% YTD, benefiting from the recent highs of Bitcoin and becoming ARKK's biggest winner.
COIN's significant YTD surge, partly attributed to Bitcoin's performance, suggests a positive short-term outlook for its stock price, especially as it gains more attention as ARKK's biggest winner.
CONFIDENCE 85
IMPORTANCE 85
RELEVANCE 80
POSITIVE IMPACT
SARK, aiming to return the inverse performance of ARKK, offers a way for traders to bet against ARKK's performance.
Given ARKK's recent losses, SARK could see a positive short-term impact on its stock price as it offers an inverse return, attracting investors skeptical of ARKK's performance.
CONFIDENCE 75
IMPORTANCE 60
RELEVANCE 50
POSITIVE IMPACT
SPY is up almost 8.5% in the same period that ARKK has faced significant losses, highlighting a divergent market performance.
SPY's positive performance in contrast to ARKK's losses could attract more investors to SPY, potentially boosting its short-term stock price.
CONFIDENCE 85
IMPORTANCE 80
RELEVANCE 70
NEUTRAL IMPACT
Investors are concerned about Wood's decision to divest from NVDA, which has missed out on significant growth.
While NVDA's growth post-ARKK's divestment is notable, the direct short-term impact on NVDA's stock price due to ARKK's decision is neutral, as the market has already absorbed this information.
CONFIDENCE 80
IMPORTANCE 75
RELEVANCE 60
NEUTRAL IMPACT
TARK, aiming to return twice the daily return of ARKK, offers a way for bullish traders to maximize their view on ARKK's performance.
TARK's potential impact is contingent on ARKK's performance. Given ARKK's current volatility, the short-term impact on TARK's stock price is uncertain, hence a neutral score.
CONFIDENCE 75
IMPORTANCE 60
RELEVANCE 50
NEGATIVE IMPACT
ARKK has lost over 3% in value and 2% of its net assets in a week, indicating a significant outflow of investment.
The significant outflow and loss in value for ARKK suggest a negative short-term impact on its stock price, as investor confidence appears to be waning.
CONFIDENCE 90
IMPORTANCE 90
RELEVANCE 100
NEGATIVE IMPACT
Tesla, ARKK's second-largest holding, has struggled this year, down roughly 14% this month alone.
TSLA's recent struggles and significant drop this month suggest a negative short-term impact on its stock price, especially as it is a major holding in ARKK.
CONFIDENCE 85
IMPORTANCE 85
RELEVANCE 80