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ARK Innovation ETF (ARKK) ETF Analysis

The ARK Innovation ETF (ARKK) is an actively managed equity fund with $7.26 billion in assets under management, focusing on long-term capital growth by investing in companies involved in disruptive innovation. With an expense ratio of 0.7500%, ARKK differentiates itself through its concentrated portfolio of just 10 holdings, targeting firms like TESLA INC and TEMPUS AI INC-CL A, primarily across the Healthcare and Technology sectors. This strategy aims to capture high-growth potential from companies at the forefront of technological and scientific advancements.

ARK Innovation ETF (ARKK) ETF — Price, Holdings & Analysis

The ARK Innovation ETF (ARKK) is an actively managed equity fund with $7.26 billion in assets under management, focusing on long-term capital growth by investing in companies involved in disruptive innovation. With an expense ratio of 0.7500%, ARKK differentiates itself through its concentrated portfolio of just 10 holdings, targeting firms like TESLA INC and TEMPUS AI INC-CL A, primarily across the Healthcare and Technology sectors. This strategy aims to capture high-growth potential from companies at the forefront of technological and scientific advancements.

ETF Overview

ARKK is an actively managed Exchange Traded Fund (ETF) that seeks long-term growth of capital by investing under normal circumstances primarily (at least 65% of its assets) in domestic and foreign equity securities of companies that are relevant to the Fund’s investment theme of disruptive innovation.
The ARK Innovation ETF (ARKK) is an actively managed fund designed to capture long-term capital growth by investing in companies at the forefront of disruptive innovation. Its investment strategy dictates that at least 65% of its assets are allocated to domestic and foreign equity securities of companies relevant to this theme. Unlike passively managed index funds, ARKK's portfolio management team makes active decisions on security selection, aiming to identify future market leaders in areas such as genomic revolution, automation, artificial intelligence, and fintech. This approach leads to a highly concentrated portfolio, currently holding just 10 securities. ARKK's current top holdings exemplify this focus, with TESLA INC representing 9.54% of the fund, followed by TEMPUS AI INC-CL A at 5.61%, and CRISPR THERAPEUTICS AG at 5.08%. Other significant allocations include ADVANCED MICRO DEVICES (4.64%) and ROBINHOOD MARKETS INC - A (4.58%). The fund's sector allocation further underscores its thematic concentration, with Healthcare comprising 28.1% and Technology 25.9% of the portfolio. Financial Services (16.2%), Consumer Cyclical (14.1%), and Communication Services (10.0%) also receive substantial weighting. This structure is intended for investors seeking exposure to high-growth, innovation-driven companies, accepting the higher volatility often associated with such concentrated, thematic investments. The fund's active management seeks to adapt to evolving technological landscapes, distinguishing it from broad market or sector-specific ETFs.

Risk Metrics

ARKK's investment profile presents several distinct risks that potential investors may want to research. The fund exhibits significant concentration risk, holding only 10 securities. This means that the performance of a few individual companies, particularly the top holdings like TESLA INC (9.54%) and TEMPUS AI INC-CL A (5.61%), can disproportionately impact the ETF's overall returns. Such a concentrated approach can lead to higher volatility compared to more diversified funds. Sector-specific risk is also prominent, with ARKK heavily weighted towards Healthcare (28.1%) and Technology (25.9%). While these sectors are central to the disruptive innovation theme, they can be susceptible to rapid shifts in consumer preferences, regulatory changes, or technological obsolescence, potentially leading to significant drawdowns. Furthermore, ARKK's 3-year Beta of 2.44 indicates that the fund has historically been significantly more volatile than the broader market. This suggests that for every 1% move in the market

Expense Ratio

0.75%

Top Holdings

Sector Allocation

  • Healthcare: 28.1%
  • Technology: 25.9%
  • Financial Services: 16.2%
  • Consumer Cyclical: 14.1%
  • Communication Services: 10.0%
  • Industrials: 5.7%
  • United States: 84.3%
  • Switzerland: 5.1%
  • Canada: 4.4%
  • Other: 3.0%
  • Cayman Islands: 1.5%
  • Taiwan: 0.9%
  • China: 0.8%
  • Ireland: 0.0%

Dividend Yield

0.00%

Risk Metrics

  • Beta: 2.44

Questions & Answers

What is ARK Innovation ETF (ARKK)?

ARKK is an actively managed Exchange Traded Fund (ETF) that seeks long-term growth of capital by investing under normal circumstances primarily (at least 65% of its assets) in domestic and foreign equity securities of companies that are relevant to t It holds 10 securities. With $7.3B in assets under management, it is one of the larger funds in its category.

What is the expense ratio for ARKK?

ARK Innovation ETF has an expense ratio of 0.75%, which is considered higher than average for equity ETFs. This means for every $10,000 invested, annual fees would be approximately $75. Lower expense ratios generally lead to better long-term returns, all else being equal.

What are the top holdings in ARKK?

The three largest positions in ARK Innovation ETF are TESLA INC (TSLA, 9.5%), TEMPUS AI INC-CL A (TEM, 5.6%), CRISPR THERAPEUTICS AG (CRSP, 5.1%). Together these top three holdings represent 20.2% of the fund, out of 10 total positions. The fund is relatively diversified across its holdings.

What sectors does ARKK invest in?

ARK Innovation ETF allocates across 6 sectors. The largest sector exposures are Healthcare (28.1%), Technology (25.9%), Financial Services (16.2%). The sector allocation provides broad market exposure across multiple industries.

How long has ARKK been around?

ARK Innovation ETF was launched in 2014, making it 12 years old. With over a decade of history, it has navigated various market conditions. It is managed by ARK.