Investors in the Ark Innovation ETF (ARKK) have been fed through the wringer this year, as Cathie Wood’s flagship disruption fund is already down 22% — whipsawing investors in both directions.
Of the 44 components of the fund, including Tesla (TSLA), Shopify (SHOP), Zoom Video (ZM), none are currently up on the year — leaving investors to lick their wounds. Since the ARKK topped out just shy of $160 nearly one year ago, rallies have become increasingly short-lived — such as last week’s flashy three-day rally that was mostly erased the following two days.
The largest ARKK component, Tesla, is a relative outperformer — down only 13% this year. Due to its $927 billion market capitalization — by far the largest stock in the ETF — Tesla has been masking the poor performance of most of the smaller components. Tesla is holding onto gains of 71% from its 2021 low — the third largest such gain behind Intellia Therapeutics (NTLA) (up 119%) and 3D Systems (DDD) (up 74%).
Looking inside the ETF, the average component is down 25% in 2022 (median 23%), with TuSimple (TSP), Berkeley Lights (BLI), and Skillz (SKLZ) getting roughly cut in half. Berkley and Skillz are both down over 90% from their 2021 peaks. The average ARKK component is down 63% from its 2021 high (median 65%) and up 22% (15% median) from its 2021 low.
Bigger names aren’t necessarily immune from heavy selling. One of the 16 tech names in the fund, e-commerce company Shopify, has plunged 36% this year. It’s also 50% off from its record high last year — taking its market cap down to $110 billion. Spotify (SPOT), a $34 billion company, topped out in February 2021. The stock has lost a quarter of its value this year and is off 55% from its peak.
The average ARKK tech component is down 59% (median 60%) from its 2021 peak but up 19% (12% median) from its low. Health care components slightly outnumber tech, with 17 names, which are down an average of 68% (69% median) from their recent highs and up 22% (16% median) from their recent lows.
ARKK holds only one financial stock under the The…