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Don't Bother With ARKX If You're Already Invested In ARKQ

Dean Young profile picture
Dean Young


  • I predicted in January that ARKX holdings would have high overlap with ARKQ holdings and I was correct.
  • There aren't enough pure-play space exploration companies available, so ARKX will typically hold aerospace, defense, and manufacturing companies.
  • If you're already invested in ARKQ, you will already own the majority of ARKX. Including ARKW, ARKF, and PRNT will get you nearly 3/4ths of the way.
Astronaut On Mars Kneeling Looking At Space Rocket In Distance
Photo by peepo/E+ via Getty Images

The long-awaited ARK Space Exploration And Innovation ETF (BATS:ARKX) has finally released its holdings this week and has begun to trade. ARK Invest defines space exploration as "leading, enabling, or benefiting from technologically enabled products and/or services that occur beyond the

This article was written by

Dean Young profile picture
B.A. Economics and Mathematics, Software Engineer@LinkedIn. Ex-Facebook. I focus primarily on investing in the tech sector where I have domain knowledge. I'm a big data geek that forms data-backed analysis of stocks.

Analyst’s Disclosure: I am/we are long ARKK, ARKG, ARKF. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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Comments (25)

Downeast profile picture
Time to add NOC ...

As I understand Cathy wood is not just looking for Space companies but also those that will benefit from SPACE infrastructure that will be built over time. Netflix is there because it will be a beneficiary of improved broadband services. I love that in the portfolio as we will benefit not only from SPACE companies but indirect plays as well. Have faith in Cathy !!!!
From the ARK website:
"This actively managed equity strategy seeks long-term capital growth by investing in domestic and foreign equity securities of companies focused on space exploration. What used to be a monopolistic and bureaucratic industry is being upended by both rocket and satellite cost declines. As a result of advancements within deep learning, mobile connectivity, sensors, 3D printing, and robotics, decades of ballooning costs have reversed trend and are beginning to decline, leading to a proliferation of satellite launches and rocket landings."

kjseagle1 profile picture
I'm in...less than ARKQ and below NAV already
Why call it space etf ?
Why is Netflix in a space and exploration etf? ... This smells like BS.
@ThePlunge That’s because broadband penetration will increase by leaps and bounds and of course Netflix will benefit from it.
There’s nothing really surprising about the holdings in this ETF when we realize that ARK’s just looking for inflows. The more surprising choice was to call it a space ETF, they should have just called it Innovation Squared (because it’s just ARK’s existing holdings and ETFs).
Flip4Flop profile picture
I agree with most points here but when it comes to the value I dont think you can beat it. Sure you are exposed to many other ARK holdings but at a fraction of the price. As tickers are swapped out or added the value should increase much quicker than other ARK funds (although the same applies to the downside). I entered a small position at the dip under 20 and plan to add up to 75% position through the summer, with most of it coming in May if the market does pull back as it usually does during that timeframe. This is nothing but a long hold for me and with it being a majority of defense sectors that hold up pretty well I like the price point.
Very excited to have entered this fund at 20$. Will hold for years to come.
ARK funds overlap, a lot...no big secret. Wood doesn't sleep. ARKX will be changing and evolving as the space economy does. Now's the first pitch of the first inning.
FergusonFutures profile picture
@scizen I agree! This is a good “cheap” entry point.
cccraig20 profile picture
@scizen correct. The author appears near sighted not far sighted. I agree with you
budcorona profile picture
While I agree with your reasoning, I disagree with the potential in performance of ARKQ and ARKX. I site VGT and FTEC. Both have exactly the same components yet VGT outperforms FTEC. Who's to say which will perform better, so why not own both for now.
SasquatchSuperViking profile picture
By the time $ARKX gets to investing in other pure play space companies, it will be closer to $30. I’d start a position now at this price. I got in at $20.20. I was cautious as I thought it may dip to the $19 or $18 region. So didn’t go all in. We may see lower prices yet, but long term this will do well.
@SasquatchSuperViking similar to my strategy. Got it at $20.10 on the first morning of trading. I believe Cathie is using positions in Netflix, Amazon, Google as a cash-like stocks till she deploys fund's capital as it builds full positions. Those 3 are big market caps, huge liquidity and plenty of call options.
SasquatchSuperViking profile picture
@strendic overall I see the beginning of the ETF to be conservative and stable. I don’t see it as all that speculative at all except $RTP and $ACIC. I think the initial list of companies surprised most people. A lot of people are let down and incredulous. That means a lower entry for us and bigger gains as time passes.
@strendic Netflix will be a beneficiary of broadband connectivity from satellites. Broadband penetration across the world will increase leaps and bounds. Of course Netflix will get more subscriptions. Just think about which companies will benefit due to broadband Availability
I like Trimble has the highest weight in ARKX. Its second largest in ARKQ. I am not invested in 3D printing so I like that too. L3Harris and Kratos has large weight. Nothing wrong with JD.com.

I will include this ETF too in my portfolio
@adaveinus2 but like.. what does jd.com have to do with space and exploration?
@ThePlunge ,
Space does not just mean Rockets or Satellites or SpaceX. Look at my previous comment

JD.com is big is drone delivery. Also ARK Invest puts money in companies which they consider cash equivalent when they cannot find pure plays at good price. Once these high conviction companies drop because of some temporary reasons ARK Invest buy them. They did not buy MAXR or some such companies because these stocks were front run in the hope ARK Invest will buy them.
@adaveinus2 ok ... I get drone delivery... But these guys are not developing drone technology. That's the exploration aspect. A drone that functions on other planets. Don't start your etf if you don't know what companies to put in it. Netflix? Really?
Thanks on this informative overview. I bought ARKX b/c my only other fund from their offering is ARKG. WRT your comments on why Amazon, Google and Netflix are in the fund could it be b/c the full positions are not in place yet? If so what does one do with fund's cash in the current market? If that is the issue I like the approach Cathie chose. Have a great day!
Would you recommend ARKX for someone who doesn't own any of the other ARK funds?
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