An exchange-traded fund that’s making waves thanks to its singular bet against Cathie Wood’s flagship fund just notched a new milestone.
The price of the Tuttle Capital Short Innovation ETF (ticker SARK) on Friday closed higher than Wood’s ARK Innovation ETF (ARKK) for the first time. In other words, it’s become more expensive to buy shares in a fund making very short-term bets against ARKK than it has to buy shares of the ETF itself.
SARK uses swap agreements with big financial institutions that are structured to deliver the inverse of ARK Innovation’s performance each day. Nonetheless it has surged more than 55% year-to-date as Wood’s main fund has lost 40% amid looming rate hikes and the war in Ukraine.
SARK ended Friday up at $57.25, while ARKK finished down at $55.58.
“It’s the same old bear market for growth stocks, especially for the speculative stuff,” Matt Tuttle, chief executive officer at Tuttle Capital Management LLC, said by phone. “Amazingly in four months, our share price lapped ARKK, which, if you told me when we launched this thing that we’d lap them in four months, I wouldn’t have believed you.”
Wood’s growth-centric ETF has been hit on multiple fronts. The Federal Reserve is commencing a rate-hiking cycle likely this month, while Russia’s invasion of its neighbor has rocked commodity prices, leading to concerns that economic growth and corporate profits could slow.