Fans of Cathie Wood and her ARK funds will soon have another exchange-traded fund (ETF) to track. The Ark Transparency ETF made its public debut on the markets today with the ticker CTRU. The ETF will seek to invest in stocks that demonstrate exceptional environmental, social and corporate governance (ESG) policies. As the name implies, the ETF will also seek to invest in companies with transparent and honest management teams.
ARK ETFs have not been having a great year. The ARK Innovation ETF (NYSEARCA:ARKK) is down 20% year-to-date (YTD) after returning 148% in 2020. Additionally, the ARK Genomic Revolution ETF (BATS:ARKG) is down 32% YTD after returning 185% in 2020. However, the new Ark Transparency ETF will differ from Wood’s previous ETFs in that it won’t seek out disruptive companies but transparent ones.
With 2021 set to end soon, investors are anticipating a better 2022 for ARK ETFs. Let’s dive into the details on Wood’s newest excursion.
ARK Transparency ETF (CTRU): 9 Things to Know
- Shares of CTRU opened this morning at $20.
- The ARK Transparency ETF will seek to track the Transparency Index. The index consists of the “top 100 transparent companies in the world.” The Transparency Index chooses these companies based on a proprietary scoring methodology.
- Since Q3 of 2016, the Transparency Index has returned 343%, beating out the S&P 500’s return of 118%.
- The Transparency Index doesn’t invest in industries like gambling, oil and gas, alcohol, tobacco and banking. It’s expected that the ARK Transparency ETF will avoid these industries as well.
- The top three holdings in the ARK Transparency ETF are currently Nvidia (NASDAQ:NVDA), MaxLinear (NYSE:MXL) and Enphase Energy (NASDAQ:ENPH). The ETF will primarily invest in large-cap and mega-cap names.
- The factsheet for CTRU states that the ETF will mainly invest in information technology and consumer discretionary companies. The fund will hold 100 names at a time and will not invest in any company with a market capitalization under $1 billion.
- ARK believes that “transparency enhances the performance of companies while benefiting the well-being of people. Transparency implies openness, communication, accountability and trust.”
- The Transparency ETF will be ARK Management’s ninth ETF and the third to track an index. ARK is the 11th biggest ETF issuer in the U.S.
- Finally, the management fee, or expense ratio, will be 0.55%, or $55 annually on a $10,000 investment.
On the date of publication, Eddie Pan did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.