Cathie Wood is throwing in the towel on one of her nine exchange-traded funds.
ARK Invest said in a statement Tuesday it will shutter its Transparency ETF (CTRU) at the end of July, just eight months after launching the investment vehicle. The move marks ARK’s first-ever fund closure.
The decision from ARK came after the firm learned Transparency Global would stop calculating The Transparency Index — the index this ETF sought to track — at the end of this month.
ARK said it failed to find a suitable replacement from other providers.
The fund's board of trustees unanimously approved the winding down and termination of the fund at a meeting earlier this month, per a filing with the SEC.
The ARK Transparency ETF is set to cease trading on the Cboe BZX Exchange July 26th. Shareholders may request a redemption of their allocation prior to the closing date.
The closure comes amid a rout across her nine exchange-traded funds — particularly the flagship ARK Innovation (ARKK) vehicle, which has lost more than 50% year-to-date.
Cathie Wood, Founder, CEO, and CIO of ARK Invest, speaks at the 2022 Milken Institute Global Conference in Beverly Hills, California, U.S., May 2, 2022. REUTERS/David SwansonWood’s transparency-focused fund, which began trading December 8, 2021, was down 33% year-to-date as of Tuesday’s close. The fund was created to targeting 100 companies it defines as "most transparent," particularly in the information offered to investors on performance and return potential. ARK Transparency also aimed to avoid companies connected to fossil fuels, tobacco and alcohol.
Among notable names in its top holdings are Teladoc (TDOC), Netflix (NFLX), Docusign (DOCU).
At the time of its launch, analysts deemed the ETF ARK's version of an ESG offering.
“It’s intriguing because it doesn’t have a moralizing vibe to it, it’s like they’re saying if you go after transparency, you’re probably going to buy good companies,” Bloomberg Intelligence Senior ETF Analyst Eric Balchunas said.
The closure of ARK Transparency comes as its parent firm sets out to launch a private markets-focused closed-ended interval fund, with an SEC filing specifying the vehicle will be suitable “only for long-term investors who can bear the risks” associated with limited liquidity.
Alexandra Semenova is a reporter for Yahoo Finance. Follow her on Twitter @alexandraandnyc
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