Introduction To ARKA
21Shares is one of the world’s largest issuers of crypto ETPs, which are exchange-traded products. It offers products and services via 21Shares AG with the objective of making crypto more accessible to investors. 21Shares is credited with launching the first physically backed Ethereum and Bitcoin ETPs. It was launched in 2018 and now accounts for over $1 billion in Assets Under Management (AUM).
What Is ARKA ETF
ARKA ETF is an acronym for ARK 21Shares Active Bitcoin Futures Strategy ETF. This actively managed exchange-traded fund leverages the capabilities of bitcoin futures contracts to target 100% exposure to BTC, the world’s flagship cryptocurrency. By actively rolling futures contracts, the aim is to overperform Bitcoin tokens.
The objective of Ark 21Shares is capital appreciation by optimizing the performance. It is important to note that the Fund does not directly invest in BTC or any other digital asset for that matter.
History Of ARKA
The price of ARKA stock as of August 02, 2024, at 5:05 pm EDT is $55.64. This is down by 4.07% and reflects a lower value in comparison to its historical data.
| Date | History of ARKA |
|---|---|
| August 02, 2024 (close) | $58 |
| July 02, 2024 (close) | $57.88 |
| June 03, 2024 (close) | $65.72 |
| December 29, 2023 (close) | $41.93 |
| November 14, 2023 (close) | $35.89 |
The price did peak, per the table, on June 03, 2024, at $65.72. It followed a bull run of March 13, 2024, when the value was $71.62. The price has yet to breach that mark again but is closer to attaining a high of $60. The close value for August 02, 2024, was $58, up from $57.88 for July 02, 2024, on an MTD basis.
The first record dates back to November 14, 2023, when ARK 21Shares closed the market at $35.89. That was followed by a jump to $41.93 within 45-50 days, evident from the trend as of December 29, 2023.
ARKA ETF Key Features
The ticker for the ARK 21Shares Active Bitcoin Futures Strategy ETF is ARKA, and its associated ISIN is US02072L3592. The key features of the ARKA ETF are summarized below.
| Features | Description |
|---|---|
| Inception Date | November 13, 2023 |
| Advisor | Empowered Funds, LLC dba EA Advisors |
| Sub Advisor | 21Shares US LLC |
| Sub-Sub Advisor | ARK Investment Management LLC |
| Type | Active Digital Asset ETF |
| Primary Exchange | Cboe BZX Exchange, Inc. |
| Fund Distributor | Quasar Distributors, LLC |
A total of 250,000 securities outstanding have been noted with an NAV per unit of $58.01. Net Assets amount to $14,502,039.20. Key features of Ark Funds help determine its future or, at the least, draw a pattern to know its potential.
Performance Of ARKA
The ARK fund performance can be done on the basis of two key trends, namely monthly and quarterly. While it has banked a dip in the last 3 months, there is a notable uptick in the last 30 days as of August 01, 2024.
| Particulars | Performance |
|---|---|
| NAV - 1 month | 10.06% |
| NAV - 3 months | -3.93% |
| Market Price - 1 month | 9.99% |
| Market Price - 3 months | -3.89% |
NAV of ARKA has gained 10.06% in a single month but is down by 3.93% on a quarterly basis. Market Price nearly replicates the trend by marking a surge of 9.99% in one month and a slip of 3.89% in the last 3 months. Nevertheless, performance is bullish on YTD basis with an upswing of 29.66% in NAV and 29.49% in Market Price. ARK ETFs have also jumped by 55.23% in NAV and 55.20% in Market Price since their inception.
The last 7 days have been bearish though. NAV has plummeted by 5.13% and Market Price has plunged by 5.12%. The change is negative despite a monthly greeny picture. This could be a reflection of overall market trend as flagship tokens have taken hits in recent days.
ARKA Stock Holdings
The table below summarizes Ark ETF holdings.
| Holdings | Shares | Price |
|---|---|---|
| United States Treasury Bill 08/29/2024 | 3,650,000 | $99.65 |
| United States Treasury Bill 09/26/2024 | 6,412,000 | $99.26 |
| CME Micro Bitcoin Aug24 | 1 | $62,945 |
| CME Bitcoin Fut Aug24 | 46 | $62,945.00 |
| First American Government Obligations Fund 12/01/2031 | 1.32 | $100 |
| U.S. Bank Money Market Deposit Account 08/01/2031 | 1,149,417.20 | $100 |
| Cash and Other | 3,351,010.03 | $1 |
It is important to note that holdings of ARKA Stock are subject to change without any notice. Investors must remain updated about changes by reviewing details published by ARK 21Shares.
Risks In ARKA ETF
Risks in the ETF market are attributed to the volatile nature of cryptocurrencies. Other risks associated with Ark ETF stock are:
- Asset Risk covers direct/indirect exposure to bitcoin. Fund seeks to make investments via Bitcoin Futures and not directly in BTC. The price is likely to vary in comparison to the current price of the token in cash markets.
- Liquidity risk pertains to the ability to sell investment with/without significantly changing its value. Market disruptions can elevate liquidity risks, making it difficult to sell or buy ARKA stock.
- Active management risk could rise if the issuer, Ark 21Shares in this case, makes a poor judgment about the performance of the underlying digital asset.
An ideal way to mitigate these risks is to conduct research and estimate one’s self-risk tolerance before allocating funds to ARKA.
How to Invest in ARKA
Several channels actively make Ark crypto ETF available and accessible to interested investors.
- Individual investors can connect with brokerage firms.
- Professional investors are recommended to connect with their financial advisors. Shares are issued at NAV per share only, and the same principle holds true for redemption.
Transactions on the secondary market require a brokerage account and can be made only throughout the trading day at market prices. There is no minimum investment amount or minimum number of shares required; however, brokers may impose these conditions on investors.
Benefits of Investing in ARKA
There are a total of three benefits of investing in Ark invest funds. These are growth potential, active management, and exposure without complexity.
- ARKA derives growth potential from the reputation of Bitcoin tokens. They were first established as decentralized currencies and hence, since then, gained sufficient traction. It has a broad user base plus high liquidity. ARKA offers a secure vehicle for investors looking to diversify their portfolio with a long-term strategic holding.
- Active Management pertains to an investment strategy wherein 21Shares constantly rolls out bitcoin futures contracts. The end goal is to optimize performance for better returns than a passive approach.
- Exposure to complexity refers to gaining direct exposure to the digital asset. ARKA eliminates that aspect to ensure that investors can fetch profits without mastering the idea of how to store BTC safely or how to trade the tokens.
It is right to conclude that these are ARKA’s benefits but do not guarantee any outcome or achievement of the investment objective as stated by ARK 21Shares.
ARKA Fees and Expenses
The ARK ETF price attracts a total annual fund operating expenses at the rate of 0.70%.
| Particulars | Charge |
|---|---|
| Management Fees | 0.70% |
| Other Expenses | 0.08% |
| Fee Waiver (Deduction) | 0.08% |
| Total Expense Ratio | 0.70% |
Effectively, the only charge applicable is a Management Fee of 0.70%. Other Expenses have been waived, as have the Distribution and/or Service Fees. Other Expenses were previously disclosed as 0.00%. They are only estimated for a particular fiscal year.
Future of ARKA ETF
The future of ARKA ETF takes inspiration from the crypto market, especially the way in which Bitcoin moves on the price chart. Volatility will hamper the returns that investors get but the future remains bullish. BTC is speculated to surpass the mark of $100,000 by the end of 2024. That could send positive waves for the market to rise and, hence, get decent returns to be taken home.
It would further be determined by the extent to which the traditional market recognizes its existence not just in a select region but in every country. Investors worry and shy away from investing due to a lack of regulatory clarity. Changes in these perspectives could further fuel an upward trajectory.
Conclusion
ARK 21Shares Active Bitcoin Futures Strategy ETF (ARKA) has had its ups and downs, as evident from its historical performance. However, there is sufficient scope for marking uptrends in the future. The fund’s performance has risen and gone as high as $65.72 recently. It is next poised to bank a value of over $70 as BTC makes its upward moves in the market.
There are risks associated with the ARKA ETF. Hence, it is recommended that you conduct thorough research and risk assessment before allocating funds to ARKA.
For further guidance or details on investing in the ARK 21Shares Active Bitcoin Futures Strategy ETF (ARKA), click here to visit the ARKA support website.