Lowered Ark – Good Return

Two years ago Cathie Wood’s Ark Fund was a market darling, now undervalued by Morningstar.

Friday, April 22nd 2022, 8:22 AM

The research firm downsized the US $ 12.2bn ARK Innovation ETF showing its ‘disastrous’ 45.5% loss over the past 12 months and little sign of progress.

Despite his humility, Wood was confident that his innovative and aggressive approach would succeed in the long run.

In its research report, Morningstar lowered its rating from non -negative, and its audience and parent scores from average to below average.

Morningstar strategist Robby Greengold said, “since the meteoric rise in 2020, the stock market has been one of the best -selling currencies in the United States, despite falling prices. A powerful plant that holds the earth. “

The stock is expected to grow 156% by 2020 as Covid-19 holdings are in high demand in its online holdings. But the top one percent of the index ended up below the 100 percentile in 2021 and the first quarter of this year, while spending lost 23.38% and 29.92%, respectively. with these times.

Greengold said “The long -term return on investment in his current division is impressive. From its inception in October 2014 to February 2022, the ETF’s annual return was more than 20.6%. leader of mid -growth funds and won 12.5% ​​earnings of the Russell Midcap Growth Index.

“But his results are much better when you consider his nature and the level of risk taking.

But its volatility is a different story.

“In the three years ended March 2022, the stock returned 14.2% year -over -year, which will not delay the 14.8% return of the Russell Midcap Growth index.

“But at the time, the 40% average return on investment was the highest in Morningstar’s Mid-Cap Growth index and almost double the 21.4% reading for the Midcap Growth index.”

Greengold also noted that Wood’s business “has no crisis management staff” and that his decision to close ARKK’s holdings (35, down from 60 at one point in 2021) has put the portfolio at a premium. trouble.

“Wood said the crisis is not about him but about the people who invest in ARK’s money,” Greengold said.

“It’s hard to see why. ARK can do more to prevent a haul of assets, and its failure to address the issue has hurt many investors in this regard. time. It could hurt again in the future. “

Words: Ark Invest

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Lowered Ark – Good Return

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