Growth Funds - Disruptors

By pjain      Published April 4, 2021, 9:57 p.m. in blog Invest   

Disruption by Sector

High Growth Key Strategies - Universals since 1970s silicon valley

Disruptive Roles and Themes

ARK believes that its sole focus on long-term disruptive innovation, proprietary open research ecosystem and active management makes us unique relative to other offerings.

  • ARK Big Ideas - 15 tech disruption areas to beat old economy

Disruptors - Long Term View - Catch it Early

Like a VC fund

The other thing we're communicating, is we're the closest you'll find to a venture capital fund in the public equity markets, but we're much more liquid, tax effective and transparent. And we think that innovation in public equity markets is hugely undervalued relative to innovation in the private market.

Cross-Fertilization combinations of Disruptions becomes exponential

ARK Growth Funds

Tracking Recent Changes Q1'2021

--- Key Success Factors

--- How it Succeeds, Grabs Funds, Marketing

Quant Scoring System

ARK Invest uses its own scoring system to continuously value companies and monitor the underlying investment thesis. As scores change, ARK's investment team adjusts stock positions in the portfolio. -- Wood

Multi-Analyst consistent Investment Process

ARK believes that its consistent investment process

No Long Term buy and hold possible in Rapid Changing Disruptive Areas

ARK believes in active management of high-conviction portfolios capitalizes on rapid change and avoids industries and companies likely to be displaced by innovation.

Active Risk Management using the Portfolio Quant Tracker

[It is possible that ] one of the leaders of the future becomes disrupted itself or does not fulfill its promise. To mitigate this risk, ARK continuously monitors the investment thesis to each of its portfolio companies using the Portfolio Tracker. The Portfolio Tracker amalgamates bottom-up scores, both qualitative and quantitative, for all stocks in the portfolio. Changes in analysts' scores trigger discussion with each portfolio team during daily morning meetings and Monday stock meetings. Any score downgraded to 6 or lower triggers full stock review. - Wood

DAY ACTIVE Trading tweaks to take advantage of High Volatility

  • In 2018 just trading TSLA one stock buy low,sell high gave overall fund 3.2% boost in performance, separate from the 6%+ rise in the stock itself.

Thematic ARKK all but also Candy Colors ARK-xyz W,Q,F,G,X,..

  • BROAD Disruptive all-in-one ETF

Thematic portfolios built around disruptive innovation face certain risks. For instance, a primary risk to ARK's investment strategy is that a disruptive technology or disrupter company that we believe will be one of the leaders of the future becomes disrupted itself or does not fulfill its promise.

The great thing about [Ark] Innovation (up 35% in 2019) is when we see one of our innovation platforms being 'treated badly' in a way that people don't understand what's going on, we tend to weight it heavily in our portfolio. Innovation is the combination of all of the innovation platforms: DNA sequencing, energy storage, robotics, AI and blockchain technology. It's weighted more heavily toward the platform that we think is not being treated as it should be in the marketplace. So, right now it's more heavily weighted in genome (30% weight). -- Cathie Wood

How it Promotes itself

  • YT weekly talk
  • Publishes Daily trades - knows most will follow very closely
  • Talk up "Strategies" - criticized as "Seat of pants" and low indepth

How it Makes Money

  • TALK UP BOOK
  • Make money with high 0.75% expense ratio

Wood: We are at 75 basis points. We're trying to communicate that our competition is not other ETFs, but actively managed mutual funds. Those often have expense ratios of 75 basis points, but then they have another 50 to 75 basis points more in hidden fees. There are no hidden fees in ETFs.

ARKK Innovation - all holdings

ARKW Next Generation Internet/SaaS/AI

All of these companies are going to be made better with AI, nuch more involved with Software-as-a-Service companies and cloud.

  • Tesla is in there because it is a heavy AI user

ARKQ Autonomous Technology & Robotics

Autonomous Technology & Robotics is much more focused on Mobility-as-a-Service, so (it holds) Tesla and the autonomous ecosystem. You've got drone plays, collaborative robot plays Teradyne (TER) (up 119%) and Amazon, and a much heavier dose of 3D printing and space exploration.

ARKG Genomics VERTICAL

  • NVTA Invitae molecular diagnostic testing company that is being very aggressive in cutting the prices of its tests down so that they can increase access.

  • CRSP CRISPR Therapeutics - 2019 human trials results which are suggesting that two people were cured of blood diseases, because CRISPR edited the genes that had mutated and caused the problem.

ARKF Fintech Innovation VERTICAL

The Fintech Innovation theme-based investment strategy invests primarily in domestic and foreign equity securities of companies that are relevant to the investment theme of financial technology, or fintech. This includes companies focused on and expected to benefit from shifting the bases of the financial sector and economic transactions to technology infrastructure platforms and technological intermediaries. They may also include ones that develop, use or rely on innovative payment platforms and methodologies, point of sale providers, transactional innovations, business analytics, fraud reduction, frictionless funding platforms, peer to peer lending, intermediary exchanges, asset allocation technology, cryptocurrencies, mobile payments, and risk pricing and pooling aggregators. ... We rode that from the days when bitcoin was $250 to when it hit $20,000. And as it began to fork and as we had to sell it when it passed 10% of our portfolio, we learned that we were at risk of having too much unqualified income, which is what commodities throw off. So, we decided to take our money and run, and we took it out at a good time. We did that for business reason, not for an investment reason. As fiduciaries, we had to protect our investors against tax consequences associated with unqualified income. - Wood on IBD

PRNT 3D Printing ETF - 6.1%

IZRL Israel Disrupters, Cybersecurity

ARKX Space


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