Publish date:

Cathie Wood's Ark Files for ETF That Resembles ESG Fund

ARK Transparency ETF would exclude alcohol, banking, chemicals, confectionary, tobacco, oil and gambling stocks among others.
Author:

Ark Investment Management, led by the high-profile fund manager Cathie Wood, has proposed to the SEC an ETF that seems to constitute its version of an environmental-social-governance fund.

The ARK Transparency ETF is based on an index “designed to track the price movements of stocks of approximately 100 companies that receive high scores for transparency,” the company said in a Securities and Exchange Commission filing.

The scoring will be based on metrics including “the company’s adoption of certain transparency standards, the company’s involvement in certain legal proceedings, and the company’s reputation.”

Further, the index will exclude alcohol, banking, chemicals, confectionary, fossil fuel transportation, gambling, metals, mineral, natural gas, oil, and tobacco.

And to be included in the index, a company must maintain a 30-day moving average market capitalization of at least $1 billion.

TheStreet Recommends

Ark, New York, will use a passive investment strategy. It has eight other funds, two of which are passive. And its ETFs have about $45 billion in assets, placing Ark 11th in the country, Bloomberg reports

TheStreet.com reported Sunday through the South China Morning Post that Ark Investment Management may be turning less bearish on Chinese tech stocks, based on last week's fund transactions.

Last week, Ark added American depositary shares of companies including Tencent, JD.com  (JD) - Get JD.com, Inc. (JD) Report and Pinduoduo  (PDD) - Get Pinduoduo, Inc. Sponsored ADR Class A Report.

Meanwhile, Scion Asset Management, led by Michael Burry, owned bearish put contracts against 235,500 shares of ARK Innovation ETF  (ARKK) - Get ARK Innovation ETF Report as of June 30, according to a regulatory filing made earlier this month. 

Burry was featured in the Michael Lewis book and film "The Big Short."