2021 has not been a good year for Cathie Wood and the ARK ETFs.
The days of triple-digit returns and an almost unprecedented five-year run seem to be a long forgotten memory. Her disruptive innovation theme has fallen wildly out of favor, short-term returns have tanked and investors are racing for the exits.
Despite both the S&P 500 and Nasdaq 100 gaining around 25% year-to-date, most of the ARK ETFs are in the red.
The tentpole ARK Innovation ETF (ARKK) is down 20%, while the ARK Genomic Revolution ETF (ARKG) is the worst performer having lost 34%. The only gainer among the major ARK ETFs is the ARK Autonomous Technology & Robotics ETF (ARKQ). It's gained just 5% despite a 12% allocation to Tesla, which is up 55% this year.
Investors have had enough. Based on past performance and when the money poured in, it's estimated that more than half of ARK ETF assets are currently underwater. Among purely thematic ETFs, ARK has the top 5 largest outflows over the past month.
ARKK is by far the biggest of the bunch and, not surprisingly, has seen the biggest outflow, nearly $1 billion. Each of the next four, which includes the ARK Fintech ETF (ARKF) and the ARK Next Generation Internet ETF (ARKW) along with ARKQ and ARKG, have shed a combined $1.8 billion.
ARKK peaked at $28 billion in assets in February. Today, it's down to $18 billion.
I find the percentages perhaps more interesting. Each has lost between 4% and 9% of total assets in just one month. Total assets in all 5 ARK ETFs is down between 35% and 55% from their 2021 peaks. Play this out over another 12 months, where flows show no sign of abating, I wouldn't be surprised to see assets shrink another 30%.
It's been a long trip for ARK over the past year.