$arkk $arkg becoming the dog wagging the tail...
https://twitter.com/EricBalchunas/status/1341518377114865666
... more $arkk pieces from this week:
@DaveNadig interview with ARK COO did a deep dive into the ETF family's liquidity/capacity hypotheticals (spoiler alert: ARK's ETF-mandated transparency means investors are buying $arkk, et al to own the underlying)
etftrends.com/ark-coo-tom-st…
@DaveNadig interview with ARK COO did a deep dive into the ETF family's liquidity/capacity hypotheticals (spoiler alert: ARK's ETF-mandated transparency means investors are buying $arkk, et al to own the underlying)
etftrends.com/ark-coo-tom-st…
... and from Morningstar:
"ARK owns more than 10% of 26 companies... it would take more than 52 trading days for it to completely exit [$cers, were they to liquidate 25% of average volume per diem]"
morningstar.com/articles/10276… $arkk
"ARK owns more than 10% of 26 companies... it would take more than 52 trading days for it to completely exit [$cers, were they to liquidate 25% of average volume per diem]"
morningstar.com/articles/10276… $arkk
... tbh, ARK's Cathie Wood probably never expected to get this big
... I trust she would not have chosen an ETF structure had she foreseen such scale – there's no way to soft/hard close an ETF, which creates some philosophical, strategic, and structural quagmires $arkk
... I trust she would not have chosen an ETF structure had she foreseen such scale – there's no way to soft/hard close an ETF, which creates some philosophical, strategic, and structural quagmires $arkk
... but, "the best laid plans of mice and (wo)men" 🤷♂️:
Expectations don't matter now that ARK *is* this big; its risks are known-knowns; so they really should be adapting!
$arkk
Expectations don't matter now that ARK *is* this big; its risks are known-knowns; so they really should be adapting!
$arkk
... an ETF is merely a conduit for market mechanism (animal sprits), but the active vs passive distinction matters:
To keep plowing active allocations into small cap/low volume eqs – knowing the empirical externalities – is either naive or short sighted
To keep plowing active allocations into small cap/low volume eqs – knowing the empirical externalities – is either naive or short sighted
https://twitter.com/EconomPic/status/1341815574033141760?s=20
... again, the active discretion of the ETF's PM is itself a part of the "market mechanism" too – not even a surrogate, but an animal spirit itself
... but, again, "known-knowns": If inflows/creations take you beyond the pale, maybe, idk, adapt 😏
$arkk
... but, again, "known-knowns": If inflows/creations take you beyond the pale, maybe, idk, adapt 😏
$arkk
https://twitter.com/AnthPB/status/1233484433979822082?s=20
... adapting meant doing right thing for both market structure/efficacy and clients/investors
... given empirical reflexivity, ARK had to have known it had gotten to the point where it was on a treadmill of greater fools – what was the end game!?
... given empirical reflexivity, ARK had to have known it had gotten to the point where it was on a treadmill of greater fools – what was the end game!?
https://twitter.com/AnthPB/status/1361868338683645952?s=20
... N.B. This is not a 'breach of fiduciary duty' or 'market manipulation' argument; rather, just a 'they should have known better' one
$arkk
$arkk
... many failures stem from either our inability to predict the future (Dunning–Kruger effect/illusory superiority/overconfidence thereof) or our mismanagement of the probabilities thereof
$arkk
$arkk
... but ARK is not a failure and did not err on either account
... more than anything, $arkk was/is right about the long term, but disregarded the short term – focused too much on the ends and not enough on the means
... hope they adapt, cuz I like what they bring to the table
... more than anything, $arkk was/is right about the long term, but disregarded the short term – focused too much on the ends and not enough on the means
... hope they adapt, cuz I like what they bring to the table
... re: ARK Invest's 2025 Tesla $tsla forecasts (N.B. should be "entire global transportation value chain", not merely "auto"):
https://twitter.com/AnthPB/status/1373299542205079552?s=20
... still nuanced and empathetic wrt ARK, but then Cathie Wood hosts a call (ark-funds.com/innovation-web…) about their capacity/liquidity and leads with this:
"capacity created just from performance" 😩
... and again I'm reminded of $arkk 'focusing on ends with disregard for means'
"capacity created just from performance" 😩
... and again I'm reminded of $arkk 'focusing on ends with disregard for means'
... later (~17:20 mark), @CathieDWood added:
'concerns about ARK's liquidity/capacity are failures of imagination – our inability to think exponentially, as opposed to linearly, about multi-year top line CAGRs (and consequently market caps/daily average dollar volumes)'
$arkk
'concerns about ARK's liquidity/capacity are failures of imagination – our inability to think exponentially, as opposed to linearly, about multi-year top line CAGRs (and consequently market caps/daily average dollar volumes)'
$arkk
... were growth in underlying holdings to provide more *relative* liquidity, ARK's ETF inflows and ownership % both have to wane
... which is possible (esp if ARK trades countercyclically), but still relies way too much on rational/orderly markets:
... which is possible (esp if ARK trades countercyclically), but still relies way too much on rational/orderly markets:
https://twitter.com/AnthPB/status/1367893465821032449?s=20
... don't want to straw man ARK – @CathieDWood did add (~10:50 mark):
'during a bull market run, we add large cap holdings to increase liquidity... so when we get to a risk off scenario like last week, we will sell those liquid large caps and rotate back into smaller pure plays'
'during a bull market run, we add large cap holdings to increase liquidity... so when we get to a risk off scenario like last week, we will sell those liquid large caps and rotate back into smaller pure plays'
... oyy, Cathie Wood (36:00 mark):
"[I prefer the ETF wrapper over a mutual fund or SMA] mostly because of flows. I don't have to worry about flows; all I have to do is worry about [portfolio management] investment decisions."
$arkk #inflows #outflows
"[I prefer the ETF wrapper over a mutual fund or SMA] mostly because of flows. I don't have to worry about flows; all I have to do is worry about [portfolio management] investment decisions."
$arkk #inflows #outflows
https://twitter.com/AnthPB/status/1367893457084223491?s=20
... on that ARK 2025 price target for Tesla (and their valuation model/share count/dilution estimates):
https://twitter.com/ChrisBloomstran/status/1375894783491719169?s=19$arkk $tsla
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