The surge in the value of bitcoin last year helped a New York investment boutique claim the title of best-performing exchange traded fund of 2017. Ark Investments, which specialises in strategies based on new technologies and disruptive innovations, included an exposure to bitcoin in the Ark Innovation ETF, which delivered a total return of 87.4 per cent last year, according to unaudited data from Bloomberg.
The company declined to disclose how much new money investors ploughed into the product, whose market value leapt from $12m to $367m last year. A sister fund, the Ark Next Generation Internet ETF, which also includes a bitcoin exposure, delivered a near-identical return of 87.2 per cent.
Its assets jumped from $16m to $236m last year, suggesting it attracted significantly less inflows than its relative. The cryptocurrency exposures in both ETFs were held via stakes in the publicly traded Grayscale Bitcoin Investment Trust.
Other holdings in the Ark Innovation ETF include Amazon, Twitter and Tesla, the electric carmaker. “A lot of our investors see these ETFs as hedges that provide protection against value traps elsewhere in their portfolio that have developed as a result of technology innovations and disruptions,” said Catherine Wood, chief executive of Ark.
Ms Wood founded the company in 2014 after an investment career stretching more than 20 years that includes stints managing money at AllianceBernstein, Tupelo Capital and Jennison Associates. Ms Wood estimates that the innovation ETF would have delivered a return of close to 60 per cent last year without its bitcoin exposure. Read more from ft.com…
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