It appears that not everyone is a fan of Cathie Wood or her fund, ARK Invest, within the financial world. Last week, a prospectus was filed for a new ETF that looks to track the inverse performance of ARK’s largest fund.
The filing comes amid what some in the financial world view as the peak for Wood’s flagship fund, the ARK Innovation ETF (NYSE: ARKK). The ETF, which is heavy on tech names such as Tesla (NASDAQ: TSLA), Roku (NASDAQ: ROKU), and Teladoc Health (NYSE: TDOC), saw its peak back in mid February at a high of $159.70, after a historic rise from a low of $33.00 at the depths of March 2020.
With the best days seemingly behind ARKK, Tuttle Capital Management last week filed with the SEC for an ETF labelled as “Short ARKK ETF”, with the proposed ticker symbol of “SARK”. The fund, which is to be managed by Tuttle Capital CEO Matt Tuttle, is looking to effectively track the inverse performance of the ARK Innovation ETF. In layman terms, that means if the value of ARKK declines, the value of SARK will inherently rise.
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No additional leverage will be provided on the performance of the ETF, meaning it intends to trade at -1x to the return of ARKK each day.
The proposed ETF, if approved, will follow the inverse performance via a number of swap agreements that it intends to enter into with “major global financial institutions.” The fund currently is expected to have a fee structure consisting of 0.65% of the fund’s daily net assets, as well as other expenses of 0.10%, for a total fee of 0.75%.
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