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Aug. 19, 2021, 3:57 p.m. EDT

The case for sinking Cathie Wood’s Ark—here’s how one ETF provider outlines the short thesis

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By Mark DeCambre

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He also noted that Wood’s investment thesis is based on long-term thinking. “She is saying ‘Hey, where is the future?…and buying those companies.“ Tuttle warned that betting against Ark Innovation also isn’t a surefire moneymaker.

“There are lots of forces in the market that could keep things moving in a [bullish] direction,“ he said.

Ark Innovation is down 7.6% so far in 2021. The Dow Jones Industrial Average /zigman2/quotes/210598065/realtime DJIA -1.40% is up 13.6% so far this year, the S&P 500 index /zigman2/quotes/210599714/realtime SPX -1.79% was up 17%, while the technology-heavy Nasdaq Composite Index /zigman2/quotes/210598365/realtime COMP -1.93% was up 12.4%.

SPY-ing lower costs

This year so far, the granddaddy of ETFs, the SPDR S&P 500 ETF Trust /zigman2/quotes/209901640/composite SPY -1.80% , known colloquially by its ticker symbol SPY, saw net outflows of about $5.2 billion in 2021, as of Aug. 13. That represents a minor net exit for SPY but CFRA’s Todd Rosenbluth attributes some of that to a shift to ETFs with lower fees.

It’s hard to beat SPYs expense ratio at 0.09%, which means that investors will pay 90 cents annually for every $1,000 invested. However, the iShares Core S&P 500 ETF /zigman2/quotes/204263249/composite IVV -1.80% and Vanguard S&P 500 ETFs /zigman2/quotes/201209218/composite VOO -1.78% both offer an expense ratio of 0.03%.

Notably, the Vanguard Total Stock Market ETF /zigman2/quotes/202677318/composite VTI -1.97% , which also offers the same expense ratio as IVV and VOO, also has drawn in the most money of any fund so far in 2021.

Buy the dip?

Analysts at Vanda Research note that investors are buying stock market dips more than not and doing so via ETFs.

“Buying the dip through broad market and leveraged ETFs remains the norm for retail investors,” wrote the Vanda analyst in a research report dated Wednesday. The researchers noted that investors bought $375million in the four most popular S&P and Nasdaq ETFs, including SPY, the Invesco QQQ Trust /zigman2/quotes/208575548/composite QQQ -1.68% , the ProShares UltraPro QQQ /zigman2/quotes/200945942/composite TQQQ -5.04% and the Direxion Daily S&P 500 Bull 3X Shares /zigman2/quotes/209706593/composite SPXL -5.37% .

Good ETF reads

/zigman2/quotes/210598065/realtime
US : Dow Jones Global
33,947.10
-482.78 -1.40%
Volume: 0.00
Dec. 5, 2022 5:05p
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/zigman2/quotes/210599714/realtime
US : S&P US
3,998.84
-72.86 -1.79%
Volume: 0.00
Dec. 5, 2022 5:05p
loading...
/zigman2/quotes/210598365/realtime
US : Nasdaq
11,239.94
-221.56 -1.93%
Volume: 4.57B
Dec. 5, 2022 5:16p
loading...
/zigman2/quotes/209901640/composite
US : U.S.: NYSE Arca
$ 399.59
-7.32 -1.80%
Volume: 77.29M
Dec. 5, 2022 4:00p
loading...
/zigman2/quotes/204263249/composite
US : U.S.: NYSE Arca
$ 401.35
-7.36 -1.80%
Volume: 4.14M
Dec. 5, 2022 4:00p
loading...
/zigman2/quotes/201209218/composite
US : U.S.: NYSE Arca
$ 367.34
-6.66 -1.78%
Volume: 3.71M
Dec. 5, 2022 4:00p
loading...
/zigman2/quotes/202677318/composite
US : U.S.: NYSE Arca
$ 199.98
-4.01 -1.97%
Volume: 3.84M
Dec. 5, 2022 4:00p
loading...
/zigman2/quotes/208575548/composite
US : U.S.: Nasdaq
$ 287.64
-4.91 -1.68%
Volume: 41.48M
Dec. 5, 2022 4:15p
loading...
/zigman2/quotes/200945942/composite
US : U.S.: Nasdaq
$ 22.23
-1.18 -5.04%
Volume: 150.99M
Dec. 5, 2022 4:15p
loading...
/zigman2/quotes/209706593/composite
US : U.S.: NYSE Arca
$ 71.15
-4.04 -5.37%
Volume: 12.57M
Dec. 5, 2022 4:00p
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