The losses can be blamed on failed investments in stocks like Roku. These darlings have been down more than 70% in the past year.
In the face of such weakness in the high-growth, high-valuation tech space, why not add Apple stock?
During a one-year period, Figure 1 shows the performance of ArKK, SPY, ROKU and ZM
The Stock Rover is a car.
The main holdings of the arKK.
Before diving in, let’s review the investment philosophy of the company. The website states that ARK innovation.
ARK defines disruptive innovation to be the introduction of a technologically enabled new product or service that potentially changes the way the world works.
Almost one-fourth of the fund’s assets are used to invest in the likes of Roku, Zoom and Tesla. The companies are leading the revolution in entertainment, office productivity and urban transportation.
Apple stock was not included in the list of over 30 names that ARKK invests in. In the past year, some AAPL shares were owned by the ARK Fintech Innovation portfolio, but they no longer do as of May 2022.
The approach to FAAMG is taken by Cathie Wood.
The team is not fond of investing in Apple or its peers, like Microsoft or Amazon. She explained why in a CNBC interview.
We are not saying that they are bad stocks, and they were a part of our portfolios when we were young. We believe that our research should be focused on the next set of FAAMGs.
In my opinion, this is a fair position. The concept of the personal computer, the personal phone, and the tablet are all improved by companies like Apple. The company could still be a disruptor in the future.
It is more likely that the next big thing in tech will be from outsiders that are trying to change the status quo. The electric vehicle revolution has been spearheaded byTesla, notFord. The peer-to-peer payments and transactions have been popularized by PayPal. The list keeps going.
The issue of timing is there. If she thought that disruptive innovation traded at unreasonable high prices, she would consider buying FAAMG stocks. Buying Apple stock would be similar to parking money on the sideline.
It is not the right time for that move. AAPL has been down 23% from its all-time high, while ARKK has lost 75% of its peak value. AAPL has returned 265% over the past five years, while ARKK has only produced a meager gains.
If there is a cheap stock in the market, that is likely to be one of the key holdings for ARK Innovation. It’s likely that AAPL won’t find its way into the ARK portfolio in the near future.
Ask about it on social media.
Suppose you are hired to run a fund that invests in disruptive innovation. How much capital would you give to Apple stock?
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This isn’t investment advice. The author may have more than one stock in this report. The article may have links to other websites. These partnerships don’t affect editorial content. Thanks for supporting Apple.