In late 2021, many might have thought a bearish idea from Matthew Tuttle was crazy. The ETF investment manager and CEO of Tuttle Capital Management launched an ETF that bet against the stock picks of Cathie Wood and Ark Invest. Here’s a look at how that ETF has performed since launching.
What Happened: Tuttle Capital Management launched the Tuttle Capital Short Innovation ETF in November 2021, as an inverse option for those wanting to bet against the Ark Invest flagship fund.
Now known as the AXS Short Innovation Daily ETF SARK, the fund is an inverse ETF to the Ark Innovation ETF ARKK. The ETF attempts to achieve the inverse of the return of the Ark Innovation ETF for a single day.
“This distinctive exposure allows investors to potentially profit from a decline in a portfolio of companies involved in disruptive industries such as electric vehicles, next-gen internet, genomics and fintech,” the press release said.
Tuttle told Benzinga previously that there was high demand to short the Ark Invest ETF.
“There are currently over 30 million shares short on ARKK, so there is massive demand,” Tuttle said.
Tuttle also pointed to the high exposure to Tesla Inc TSLA as being among the reasons why investors might want to bet against Ark and Wood.
“Whether you believe that the current bull thesis for transformational industries is a stretch or you are looking to provide protection to an existing portfolio of high-growth stocks, SARK is a potentially attractive opportunity worth exploring.”
When Tuttle Capital Short Innovation ETF was launched, the Ark Innovation fund was one of the top-performing ETFs with three and five-year returns of 174.8% and 538.7% respectively.
Since that time, shares of the Ark Innovation ETF have fallen significantly and hit new five year lows. Here’s a look at how SARK has performed.
Related Link: Are Growth Investors Finally Cutting Ties With Cathie Wood? Ark Innovation Flows Vanish
Investing $1,000 in SARK: The Tuttle Capital Short Innovation ETF opened for trading on Nov. 9, 2021 and hit a high of $30.78 on its first day of trading.
A $1,000 investment in the ETF could have purchased 32.49 shares. The $1,000 investment would be worth $2,158.96 today based on a price of $66.45 for the ETF at the time of writing.
This represents a return of 115.9% in just over a one-year time period.
The Ark Innovation ETF, on the other hand, hasn’t fared so well. A $1,000 investment in the Ark Innovation ETF could have purchased 8.05 shares at the intraday high on Nov. 9, 2021. The $1,000 investment would be worth $258.97 today, representing a decline of 74.1% over the last year.
Read Next: Want To Bet Against Jim Cramer? New Inverse ETF Filed By The Man Who Took On Cathie Wood
Photo: Courtesy of Shutterstock.
© 2023 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.