Opinions
Jim Cramer - Mad Money
ARK Innovation ETF
ARKK-N
COMMENT
Jun 18, 2021
$118.900
Stock price when the opinion was issued
E.T.F.'s
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Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research.
The ARK funds have likely bottomed, on the basis that interest rates and inflation have peaked. Although, even if the fund has truly bottomed, it may trade sideways for longer than an investor can wait, and we would not expect the parabolic action that it saw in 2020 to occur anytime soon. The underlying companies in the fund are growing fast, but valuations are still on the high end, and we feel it will take a substantial shift in market sentiment to a 'risk-on' environment to see material gains in the name. With that said, we think the name can do well over a long timeframe, and we think investors will need to be patient here.
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E.T.F.'s
Run by Cathie Wood, the mnost successful money manager on 2020 who invests in high-growth tech stocks. Their glaring flaw was a lack of diversification, which is why her ETF hot hammered this year when tech fell out of fashion. In May, Ark saw negative fund flows for the first time in over a year. ARKK is one Wood's largest ETFs. ARKK is down 5% YTD while the indexes are up. Her holdings like Zoom Video are considered Covid stocks. Wood, though, remains a wizard. Her small funds have performed better than the benchmarks and remains a fantastic long-term performer. But the era of Wood propping up these hyper-growth stocks with her massive inflows is over.