While it is seeing a large bounce today currently up 5% as of this writing, Cathie Wood’s flagship fund, the ARK Innovation ETF (ARK), has had a rough go of it over the past year and change.  The ETF peaked in February of last year and has fallen over 60% in the months since then, erasing the entirety of the post-pandemic rally. As for the current holdings making up the ETF, everything has pulled back from post-pandemic highs which were mostly set either in early 2021 or late 2021. To highlight this, in the chart below we show each current holding’s change (in percentage terms) from its respective 5-year high.  The average holding is currently down over 70% from its high.  (ARKK holdings are released daily at ARK’s website.)

Average ARKK performance

Below is a snapshot of current ARKK holdings and where they’re trading relative to 5-year highs.  Year to date, only one stock in the ARKK ETF, Signify Health (SGFY), has managed a positive move as the average YTD decline currently stands at 40.8%. That being said, SGFY is still down over 60% versus its February 2021 high.  As previously mentioned, most other holdings similarly peaked in the first quarter of last year while many others peaked more recently last fall.  As shown in the table, the average peak date for all ARKK holdings was 3/11/21.

One of the stocks that hit a high last fall is the mega-cap EV giant Tesla (TSLA).  Since its November 4th, 2021 high, TSLA has fallen only 18.41%, and it is only down 5% year to date.  Even though hardly anyone would wish to see an investment lose nearly a fifth of its value, that is a substantially better result than most other ARKK holdings.  For example, Berkley Lights (BLI) down 94% from its 5-year high, while 43% of the ETF’s holdings have fallen by at least 75%. Given that TSLA is by far the largest ARKK holding with a 10.55% weight, its smaller decline relative to the rest of the ETF’s holdings has helped ARKK from falling even more.

With the average ARKK stock down 70% from its 5-year high, it’s going to take a huge rally in the “growth” space to get back to prior levels.  As shown at the bottom of the table, the average stock in the ETF now needs to rally 348% to get back to prior highs!  Click here to learn more about Bespoke’s premium stock market research service.

ARKK holdings

Bespoke Investment Group, LLC believes all information contained in this report to be accurate, but we do not guarantee its accuracy. None of the information in this report or any opinions expressed constitutes a solicitation of the purchase or sale of any securities or commodities. This is not personalized advice. Investors should do their own research and/or work with an investment professional when making portfolio decisions. As always, past performance of any investment is not a guarantee of future results. Bespoke representatives or clients may have positions in securities discussed or mentioned in its published content.

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