Cathie Wood’s ARK Invest to shut down Transparency ETF
Yahoo Finance’s Alexandra Semenova joins the Live show to discuss Cathie Wood’s ARK to shutter transparency ETF following index closure.
Video transcript
JULIE HYMAN: Cathie Wood, who's throwing in the towel on one of her nine exchange funds. The ARK Transparency ETF, which is down over 30% for the year, will cease trading on July 26. This comes after Transparency Global said it would stop calculating its transparency index. That's the index the fund sought to track. With more on this closure, Yahoo Finance's Alexandra Semenova. This is by far the smallest of her funds as well, right?
ALEXANDRA SEMENOVA: Yeah, it is about $13 million in assets under management since launching in December. Just when things were starting to look up for Cathie Wood with some of her funds getting a nice lift off from trading near pandemic lows, she's being dealt another blow with this. The Ark Transparency ETF-- that's ticker CTRU-- is set to shut down at the end of this month.
Ark Transparency, which is less than eight months old, was created to track companies that it finds transparent in terms of the information that they provide to investors about return potential. That's a theme that, obviously, is a big part of Ark Invest. And so the decision by Ark to liquidate the fund actually comes after Transparency Global decided to stop calculating the transparency index, which Ark's fund seeks to track.
Investors can submit redemption requests. But keep in mind that anyone who invested in the fund in December is locking in their losses. The fund is down 38% year to date, Julie, as you said. On one hand, this is obviously not Ark Invest's fault since they lost the provider for the ETF.
But on the other hand, if Ark were still the ultra hot firm that it was during the pandemic, someone would have stepped in and easily made them a suitable replacement for this. And keep in mind, this also comes as Ark is set to launch a new fund, a crossover between public and private markets.
BRIAN SOZZI: How is she doing otherwise? How are her other funds been doing lately?
ALEXANDRA SEMENOVA: Well, they've seen a nice lift-off from trading near pandemic lows. They were reaching around $36 a share, which was the lowest price that it reached in-- during the height of the pandemic, and trading about $47 a share today, so a nice little rebound that we've been seeing, along with some tech stocks.
BRIAN SOZZI: Our Cathie Wood expert.
JULIE HYMAN: I'm just looking at the one-year chart, though, of ARKK.
BRIAN SOZZI: [INAUDIBLE]
ALEXANDRA SEMENOVA: It's still brutal.
JULIE HYMAN: I mean, that's quite a little bump off the lows. I mean, it's like bump, bump, bump, bump, bump.
ALEXANDRA SEMENOVA: Yeah, sure you see a nice little rebound, but that slide from--
JULIE HYMAN: Yeah, ugh.
ALEXANDRA SEMENOVA: --February 2021.
BRIAN SOZZI: Tough to see. Alexandra Semenova, appreciate it.
