ARKQ

ETF full name: ARK Autonomous Technology & Robotics ETF

Segment: Global robotics and AI

ETF provider: ARK ETF Trust

About the ETF

ARK Autonomous Technology & Robotics ETF (ARKQ) is an actively managed exchange-traded fund by Cathie Wood’s ARK ETF Trust. It was launched in September 2014. Its expense ratio is 0.75%, which is on the lower side for an actively managed fund.

The fund managers combine top-down and bottom-up research to identify innovative companies. The ETF invests at least 80% of its assets in the US and international securities of the AI and robotics companies. It has 49 stocks in its portfolio.

ARKQ FactSet analytics insight

The ETF seeks to benefit from the development of disruptive products, services, and technologies. It invests in autonomous transportation, 3D printing, robotics & automation, space exploration, and energy storage.

As an actively managed ETF, it doesn’t track a benchmark index. It is up to the fund manager to determine which stocks to invest in and how much. The ARKQ recently sold 315,600 shares of Virgin Galactic (NYSE: SPCE), though it still holds 1.76 million shares of the company.

Since ARKQ gives investors exposure to a specific theme, it has little overlap with the traditional index funds. As a result, it offers investors a tool to diversify their portfolios.

ARKQ annual performance analysis

Cathie Wood’s big bet on disruptive technologies has paid off well. The ARK Autonomous Technology & Robotics ETF has returned a staggering 154.29% over the last year compared to 56.35% by the S&P 500 index.

Since its inception in 2014, the ETF has returned 25.87% annually, significantly outperforming the S&P 500’s 13.55%. The ARKQ’s three-year returns were 38.45%, and five-year returns stood at 36.20%.

Of course, the massive rally in tech stocks over the last year has helped the ETF. Tesla Inc (Nasdaq: TSLA) stock has rallied almost 500% over the previous year, propelling the ETF’s performance. Tesla is the single largest holding in the ARKQ ETF.

ARKQ key holdings

Tesla Inc (Nasdaq: TSLA) is Cathie Wood’s high conviction stock, and it has delivered spectacular returns over the last year. Tesla is the single largest holding, accounting for 11.49% of the ETF.

Trimble Inc is the second-largest holding at 5.89%. It is closely followed by the American Depository Receipts of Baidu Inc., which makes up 5.16%. Another Chinese company JD.com Inc. accounts for 4.88% of the ETF. Rounding out the top five is the Class-C stock of Alphabet Inc. at 4.72%.

These are the ten most significant holdings of ARKQ:

Industry outlook

Artificial intelligence and robotics are leading the charge in disruptive technologies. These themes have broad applications in various industries, and they have plenty of growth potential ahead.