As technology advances and markets try to seek out the next big thing, investors can consider exchange traded funds that focus on disruptive innovations to potentially capitalize on growing themes that could pervade the global economy.
“We solely focus on disruptive innovation, and this is a really exciting time for disruptive innovation because we see five technological platforms taking place at the same time – more than ever before in history,” Tom Staudt, Chief Operating Officer, ARK Invest, said at the Inside ETFs conference. “We’re focused on genomic sequencing, we’re focused on autonomous technology and robotics, we’re focused on energy storage, we’re focused on artificial intelligence and machine learning, and then also blockchain technology, and these are seeping across every part of the economy.”
For example, ARK Invest’s flagship ARK Innovation Fund (ARKK ) seeks to invest in the cornerstone companies taken from healthcare, technology and industrial sectors that focus on investing in disruptive innovation. Such companies may include ones that benefit from big data, cloud computing, cryptocurrencies, the sharing economy, genomic sequencing, molecular medicine, agricultural biology, 3D printing, energy storage, and autonomous vehicles.
The actively managed fund includes companies that merge healthcare with technology and capitalize on the revolution in genomic sequencing. These companies try to better understand how biological information is collected, processed, and applied by reducing guesswork and enhancing precision; restructuring health care, agriculture, pharmaceuticals and enhancing our quality of life.
The technology component focuses more in the next generation of internet names. These tech companies benefit from the shifting bases of technology infrastructure to the cloud, enabling mobile, new and local services, such as companies that rely on or benefit from the increased use of shared technology, infrastructure and services, internet-based products and services, new payment methods, big data, the internet of things, and social distribution and media.
Lastly, the industrial exposure covers a so-called new industrial revolution or advances in autonomous vehicles, robotics, 3D printing, and energy storage technology that are enhancing productivity, reducing costs, and transforming the manufacturing landscape.
Investors can look to the ARK Industrial Innovation ETF (ARKQ ), ARK Web x.0 ETF (ARKW ) and ARK Genomic Revolution Multi-Sector Fund (ARKG ) to target the three innovative segments separately. The ARK Industrial Innovation ETF captures the converging industrial and technology sectors, capitalizing from autonomous vehicles, robotics, 3D printing, and energy storage technologies. The ARK Web x.0 ETF targets next-gen internet innovations like artificial intelligence, cloud computing, cryptocurrencies, and blockchain technology. Lastly, the ARK Genomic Revolution Multi-Sector ETF tracks the convergence of tech and health care.
ARK Invest also came out with the ARK Fintech Innovation ETF (ARKF) to help ETF investors capitalize on the burgeoning fintech industry that provides innovative financial solutions in a digital age. ARKF invests in equity securities of companies that ARK believes are shifting financial services and economic transactions to technology infrastructure platforms, ultimately revolutionizing financial services by creating simplicity and accessibility while driving down costs.
Watch the interview between ETF Databse Co-CEO Tom Lydon and Tom Staudt:
For more ETF-related commentary from Tom Lydon and other industry experts, visit our video category on ETF Trends.