Cathie Wood’s 2025 so far seems like classic ARK, with huge bets on disruption and full tolerance for the choppiness that comes with it. Her flagship ARK Innovation ETF  (ARKK) is up over 57% YTD, with ARK Next Gen Internet soaring nearly 65%, and ARK Autonomous Tech & Robotics close behind at 47%. All three funds are outpacing the S&P 500’s 15% total return by a comfortable margin. Naturally, Wood’s flamboyant investing style works when the narrative and numbers align, and this year they have, with AI a ...

adventtr/E+ via Getty ImagesWith the artificial intelligence economy remaining the dominant narrative in the market, it is understandable that investors could be on the lookout for an exchange-traded fund offering exposure to that theme. Thankfully, they have a wide spectrum of ETFs to choose from, with the ARK Autonomous Technology & Robotics ETF (BATS:ARKQ) being one notable example. Focused on high achievers in autonomous mobility, intelligent devices, advanced battery tech, adaptive robotics, etc., ...

Group 1 - The ARK Autonomous Technology & Robotics ETF (ARKQ) focuses on companies benefiting from advancements in technology, particularly in autonomous mobility, intelligent devices, and robotics [5][10] - Since its inception in 2014, ARKQ has significantly outperformed the market, especially during the pandemic, but it is characterized by high volatility and substantial risks, as evidenced by a 46.75% decline in 2022 [3][18] - The ETF is actively managed by Cathie Wood, who is known for her focus on disruptive innovation and has attracted considerable media attention for her investment philosophy [8][13] Group 2 - As of September 10, 2025, ARKQ's portfolio consists of 36 holdings, with Tesla being the largest at an 11.35% weight, and the portfolio is heavily concentrated in industrials and information technology sectors [33][37] - The ETF has a high expense ratio of 0.75%, which is 1.75 times higher than the median for Technology ETFs, and it has assets under management of $1.3 billion [10][54] - ARKQ's performance has shown a boom-bust pattern, with significant outperformance in certain years, such as 2020, but underperformance in others, particularly in 2021 and 2022 [21][23] Group 3 - The ETF's holdings are primarily high-beta stocks with lower quality metrics, which can lead to deeper losses during market corrections [40][44] - ARKQ has a weighted average market cap significantly lower than that of QQQ, indicating a focus on smaller and potentially more volatile companies [42] - The fund's strategy includes investing in both established companies and early-stage players, with a notable absence of exposure to traditional energy companies, focusing instead on energy transformation [35][39] Group 4 - ARKQ has shown strong revenue growth characteristics, but its profitability metrics are weaker compared to its peers, with only 60% of its holdings earning a B- Quant Profitability rating or higher [44][51] - The ETF's maximum drawdown was -52.62%, indicating a high level of risk associated with its investment strategy [54] - Investors in ARKQ should be prepared for significant volatility and potential losses, particularly in a rising interest rate environment, as seen in 2022 [49][57]

Market Overview - The S&P 500 and Nasdaq-100 indices are currently about 10% and 13% below their respective peaks from 2025, indicating they are out of bear market territory [1] - Some index funds and actively managed ETFs remain in bear markets, defined as being 20% or more below their highs [1] Small-Cap Stocks - Small-cap stocks are trading at their lowest price-to-book valuations relative to large-cap stocks in over 25 years, with the gap widening since the start of 2025 [2] - The average stock in the Russell 2000 small-cap index has a price-to-book multiple of 1.8, compared to 4.6 for the typical S&P 500 stock [3] Investment Vehicles - The Vanguard Russell 2000 ETF (VTWO) is highlighted as a preferred investment option due to its low expense ratio of 0.07% and its diversified holdings across 2,000 small-cap stocks [4] - The Vanguard Real Estate ETF (VNQ) is currently 25% below its all-time high, affected by the rising-rate environment that has placed REITs in a technical bear market [5][6] Real Estate Sector - Elevated interest rates negatively impact REITs by making risk-free returns more attractive, increasing the cost of capital, and leading to declines in commercial property values [6] - There is potential for a turnaround in the real estate sector, with expectations of four 25-basis-point Federal Reserve rate cuts by year-end, alongside a 4.2% yield from the VNQ ETF [7] Technology Sector - The Ark Autonomous Technology & Robotics ETF (ARKQ) is an actively managed ETF that focuses on AI investment opportunities, differing from traditional AI index funds by not being top-heavy with big tech stocks [8][9] - The ETF is currently about 18% below its 2025 peak and 30% below its all-time high, presenting a potential investment opportunity for those interested in AI [10]