The ARKK ETF finished at its lowest level in five years on Friday, indicating how badly the global market selloff has affected Cathie Wood’s flagship fund.
After falling 78% from its highs last year, Cathie Wood’s flagship fund on Friday finished at its lowest level in five years.
The price of shares of the ARK Innovation ETF (ticker: ARKK) fell 5.7% to $33.99 by day’s end. Over the course of the five days, the fund lost almost 9.4%, marking its sixth consecutive weekly loss.
According to Todd Sohn, ETF strategist at Strategas Securities, “nothing has changed in the bigger macro backdrop — a strong currency is squeezing risk assets, inflation keeps surprising to the upside, rates remain sticky, and the Fed has to keep tightening.” “That’s a lousy combination for high-growth,”
The $6.7 billion ETF hasn’t had a good year as big holdings like Tesla Inc. and Zoom Video Communications Inc. have taken a beating. Growth-oriented assets, such as tech equities or Tesla, a favourite among retail traders, have plummeted as the Federal Reserve boosts rates to quell soaring inflation rates.
In an open letter to policymakers this week, Wood criticised the central bank for its aggressive tightening drive and expressed worry that they might be following bad policy.
The current risk-off environment, according to Wood, means that investors are looking for safety in passive benchmark-tracking products and are failing to recognise that the investments in her fund are positioned for the long term. Wood and her company frequently state that they are focused on