When you think of stimulating investments, exchange-traded funds may be the last thing that comes to mind. But while most ETFs simply track the indices, the active ETFs offered by investment firm ARK Invest have received a lot of attention.
This makes sense when you look at the returns that ARK funds have recently made. All five ETFs actively managed have more than doubled in the past 12 months, with ETF ARK Genomic Revolution (NYSEMKT: ARKG) leading the group and tripling since that time last year. ARK Innovation ETF (NYSEMKT: ARKK) and ARK Next Generation Internet (NYSEMKT: ARKW) are not far behind.
ARKF data by YCharts.
Smart investors want to know what stocks Cathie Wood, chief investment officer at ARK Invest, is looking at. Fortunately, ARK discloses all its movements every day, and you can see what it does with just a little delay.
To avoid the hassle of looking at yourself, below are three of the stocks that several ARK ETFs have invested the most money over the past week.
1. Opendoor Technologies
The biggest purchase of this ARK Fintech Innovation ETF (NYSEMKT: ARKF) done last week was Opendoor Technologies (NASDAQ: OPEN). The fund made purchases not once, but twice during the week, adding up to a total of more than 406,000 shares. This increased Opendoor’s stake in the fund’s overall assets by almost half a percentage point, giving it a weighting of 1.79% in the ETF at the end of the week.
Image source: Getty Images.
Opendoor went public last month through a merger with a special purpose acquisition company managed by the pioneering SPAC company Chamath Palihapitiya’s Social Capital Hedosophia Holdings. The company is looking to upset the entire housing market by offering a quick alternative like “iBuyer” to the months-long process of listing a home, accepting offers and waiting months for buyers to obtain financing and finally closing the deal. Instead, Opendoor can make its own offering in just a few days in several important markets, and the company expects to grow to serve other areas as well.
Some are not convinced of Opendoor’s superiority, noting that it has a lot of competition and that the race before and after the SPAC merger was completed made the shares look expensive. However, ARK Fintech Innovation seems to disagree, and it will be interesting to see if the position continues to grow.
2. Pinterest
ARK Innovation made big purchases during the week, and one of the ETF’s biggest targets was Pinterest (NYSE: PINS). Two purchases added more than 613,000 shares, increasing ARK Innovation’s holdings in the social media company by more than a quarter and increasing its allocation to almost 1%.
Pinterest is just one of many social media companies and is certainly not the biggest. But Pinterest stands out because of its positive and supportive user base, challenging many of the stereotypes about the destructive qualities that many social media platforms have.
A criticism of Pinterest is that it did not do as good a job as some of its peers in turning public attention into cash. Still, Pinterest has plans to increase monetization in the next year, reaching out to more of its international participants and using more video content for advertising. The company has to walk a fine line to avoid spoiling its positive vibe, but ARK Invest is just one of many investors who think Pinterest can get the job done.
3. Skillz
Finally, ARK Next Generation Internet made several moves, and one of the most interesting was to increase its small position in Skillz (NYSE: SKLZ). A large purchase of 429,000 shares nearly doubled the ETF’s position in the esports gaming platform provider to 0.40% of the portfolio, and it appears that Wood may be building a more substantial stake slowly.
Skillz has also gone public through a SPAC combination, and investors are excited about the number of mobile game creators who are using their platform to launch their products on the market. With Skillz getting a share of every transaction players make, the revenue possibilities are almost endless.
There is still a lot of room for growth, however, as Skillz has only about one in 1,000 players among its monthly active users. But ARK Invest seems to agree with the company’s strategy of investing heavily in customer acquisition and marketing, and if it can bring even a small fraction of players from around the world to its platform, the actions may be worth it.
Keep an eye on ARK
ARK Invest definitely explored some of the most interesting topics on the market last year. It remains to be seen whether this success will continue, but one thing is certain: people are noticing the stocks in which the company’s ETFs decide to invest.