Cathie Wood’s flagship ARK Innovation ETF (NYSEARCA:ARKK) experienced net outflows of $537M in October, marking the third consecutive month of investors pulling out cash from the exchange-traded fund.
In October alone, ARKK investors withdrew $52.23M as the innovation-focused fund plummeted by 11.6%. This decline followed a 9.1% sell-off in September and a 12.2% drop in August.
Throughout the year, ARKK has had a rollercoaster performance. It surged by 61.2% to reach a trading high of $51.33 in mid-July 2023. However, the fund subsequently experienced a 32% drop from its peak, bringing its year-to-date performance to +15.1%.
Investors have withdrawn $861M from the fund over the course of the full 2023 trading year, reflecting the volatility and resulting fluctuations in ARKK’s value.
Several factors contributed to ARKK’s decline in October, including the performance of its top holdings. Stocks such as Coinbase Global (COIN), Tesla (TSLA), Zoom Video Communications (ZM), Roku (ROKU), and UiPath (PATH), which collectively account for 40.57% of ARKK, all experienced downward trends.
Here are the October returns for these top holdings: COIN -1.8%, TSLA -17.9%, ZM -14.2%, ROKU -15.1%, and PATH -9.4%.
Note: Data flow is per etf.com.
ARKK’s Rollercoaster Ride: Analyzing Returns and Performance
ARK Innovation ETF’s performance has been a wild ride, with significant fluctuations in returns over the years. Let’s take a closer look at how ARKK and its top holdings have fared.
ARKK’s Year-To-Date (YTD) Performance:
- ARKK surged by 61.2% in 2023, reaching a trading high of $51.33 in July.
- From its peak, ARKK experienced a 32% drop, resulting in a YTD performance of +15.1%.
Top Holdings’ Performance:
Let’s dive into the performance of ARKK’s major holdings in 2023:
1. Coinbase Global (COIN):
- COIN had a disappointing October, experiencing a decline of 1.8%.
2. Tesla (TSLA):
- TSLA faced significant challenges in October, with a steep decline of 17.9%.
3. Zoom Video Communications (ZM):
- ZM struggled in October, recording a downward trend of 14.2%.
4. Roku (ROKU):
- ROKU encountered a decline of 15.1% in October.
5. UiPath (PATH):
- PATH witnessed a decline of 9.4% during October.
While ARKK and its top holdings have experienced volatility, it’s important for investors to consider the long-term performance and potential growth prospects of these innovative companies.
Conclusion
Cathie Wood’s ARK Innovation ETF, ARKK, has faced outflows for the third consecutive month in October. The fund’s performance has been volatile throughout the year, with significant ups and downs in returns. The decline in October can be attributed to the performance of ARKK’s top holdings, which experienced notable decreases. Investors should be mindful of the ongoing fluctuations in ARKK’s value and carefully consider the long-term growth potential of these innovative companies.
