Cathie Wood's flagship fund pockets $300 million in fees since its 2014 launch – but her investors haven't been so lucky
Brendan McDermid/Reuters
- Cathie Wood's Ark Invest has raked in $310 million in fees on its flagship ARK Innovation ETF fund since its inception, new research shows.
- That's despite the fund's poor performance over the last two years, notching losses of 70% in 2022 and 21% the year prior.
- ARKK's annual management fees of 0.75% of assets is double the average of actively managed ETF's, per FactSet.
Cathie Wood's flagship fund Ark Innovation ETF has bagged $310 million in fees since its launch nine years ago, new research shows.
"Investment fees have provided ARK and Cathie Wood a very good living," Elisabeth Kashner, director global funds, research and analysis at FactSet told the Financial Times.
Wood's firm Ark Invest charges an annual management fee of 0.75% of assets on its main fund – that's double the average for actively managed exchange-traded funds, according to FactSet.
The data shows investors have remained loyal to Wood's ARK Innovation ETF (ARKK) despite its poor performance in 2022. The fund plunged nearly 70% last year as the Federal Reserve's aggressive interest-rate hikes damped investor appetite for growth-focused stocks. ARKK tumbled 21% in 2021.
Per Morningstar data, Wood's fund has lost $9.5 billion in investor money over the years with her risky bets. At the same time, FactSet revealed that investors have lost nearly 27% in dollar-weighted returns by investing in ARKK – with every dollar pumped into the fund worth 73 cents on average now. "Her investors haven't been so lucky," Kashner said.
Wood's earnings from ARKK's management fees are still going strong in the new year. According to FactSet, the fund is reeling in an average of $230,000 in fees a day as ARKK's value recovers thanks to improved investor optimism about the US economy's overall health.
Since the start of 2023, ARKK has gained 27% and logged its best month in history in February largely because its darling stock Tesla made a roaring comeback. Wood, the famed investor, recently glorified her flagship fund as the "new Nasdaq" on the strong results, saying investors believed in Ark's bets.