ARKX Space Exploration ETF: Not Going To The Moon (Yet)

22
5
Favorite

ARKX Space Exploration ETF: Not Going To The Moon (Yet)

seekingalpha2021-05-03

Summary It is very difficult to get exposure to space exploration, especially in public markets. "Space Exploration ETF" is a slight misnomer, as most of the fund is focused between the earth's ...

Source Link

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

Report

Comment（5）

Turtlebizkit
·2021-05-03
[Sly]
Reply
Like
Report
Jloong
·2021-05-03
[微笑]
Reply
1
Report
liew927
·2021-05-03
jjzjs
Reply
Like
Report
Money Sprout
·2021-05-03
It does’nt hve that many space stocks in the firstplace
Reply
Like
Report
Daniel Tay
·2021-05-03
Likes and comment pls, thanks
Reply
Like
Report

Most Discussed

7x24

All

Terms and Conditions·Privacy Policy

Company: TTMF Limited. Tech supported by Xiangshang Yixin.

Email：uservice@ttm.financial

{"i18n":{"language":"en_US"},"data":{"share":"https://ttm.financial/m/news/1179835136?lang=en_US&edition=fundamental","thumbnail":"","is_english":true,"pubTime":"2021-05-03 13:49","share_image_url":"https://static.laohu8.com/5a36db9d73b4222bc376d24ccc48c8a4","id":"1179835136","market":"us","top_or_hot":-1,"title":"ARKX Space Exploration ETF: Not Going To The Moon (Yet)","media":"seekingalpha","content":"<div>\n<p>Summary\n\nIt is very difficult to get exposure to space exploration, especially in public markets.\n\"Space Exploration ETF\" is a slight misnomer, as most of the fund is focused between the earth's ...</p>\n\n<a href=\"https://seekingalpha.com/article/4423596-arkx-space-exploration-etf-not-going-to-moon-yet\">Source Link</a>\n\n</div>\n","source":"seekingalpha","html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>ARKX Space Exploration ETF: Not Going To The Moon (Yet)</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nARKX Space Exploration ETF: Not Going To The Moon (Yet)\n</h2>\n\n<h4 class=\"meta\">\n\n\n2021-05-03 13:49 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4423596-arkx-space-exploration-etf-not-going-to-moon-yet><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Summary\n\nIt is very difficult to get exposure to space exploration, especially in public markets.\n\"Space Exploration ETF\" is a slight misnomer, as most of the fund is focused between the earth's ...</p>\n\n<a href=\"https://seekingalpha.com/article/4423596-arkx-space-exploration-etf-not-going-to-moon-yet\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"ARKX","symbol_name":"ARK Space Exploration & Innovation ETF","start_time":0,"source_url":"https://seekingalpha.com/article/4423596-arkx-space-exploration-etf-not-going-to-moon-yet","article_id":"1179835136","we_media_id":null,"thumbnails":[],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=1179835136","pubTimestamp":1620020959,"sourceInfo":{"source_id":"seekingalpha","name":"Seeking Alpha"},"weMediaInfo":null,"summary":"Summary\n\nIt is very difficult to get exposure to space exploration, especially in public markets.\n\"S","collect":0,"end_time":0,"defaultTopTitle":"seekingalpha.com","property":[],"viewcount":null,"language":"en","relate_stocks":{"ARKX":"ARK Space Exploration & Innovation ETF"},"translate_title":"ARKX太空探索ETF：尚未登月","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"ARKX":0.9},"content_text":"Summary\n\nIt is very difficult to get exposure to space exploration, especially in public markets.\n\"Space Exploration ETF\" is a slight misnomer, as most of the fund is focused between the earth's surface and low earth orbit.\nARKX does deserve credit for selecting key players and prime beneficiaries behind the scenes of the emerging space industry.\nWhile there may not be enough accessible participants to adequately fill a space exploration themed ETF today, ARKX could be the best vehicle for this in the future.\nThere are currently better alternatives for space exposure via SpaceX.\n\nPhoto by bjdlzx/E+ via Getty Images\nWhether it is stargazing in Algonquin Park or binging several episodes of Neil DeGrasse Tyson's \"Cosmos: A Spacetime Odyssey\", I have always been captivated by the enigma that is space. So, naturally, when my favorite asset manager ARK announced they would be launching a space-themed ETF, I felt obliged to comment. When ARK formally filed for the launch at the beginning of the year, their funds across the board were near their respective apogees (to borrow a term from the aerospace industry). With ARK's recent performance and media exposure, it all made for the perfect platform to launch an exciting new fund, focused on everything that lies beyond the pale blue dot we call Earth.\nARK has been building anticipation by alluding to the creation of a space-themed ETF for a while, and the time has finally come to launch. While space sounds ambitious and full of potential, it's important to keep things practical. I am personally a pretty big fan of ARK's philosophy, ETF products, and the research they publish, but I will not be jumping on the ARK Space Exploration ETF (ARKX) just yet. I imagine many of you are contemplating a purchase of the new fund, however, so let's come down to earth for a moment to consider what you're potentially buying.\nARK Invest & Space\nFirst, a bit of a disclaimer and synopsis on ARK. I have invested in ARK's ETFs and have spent hours upon hours sifting through their white papers on various emerging technologies. For those not already familiar with ARK (I previously gave a detailed breakdown of their research process in my article on ARKW), they operate on the principle of investing in disruptive innovation that is due for mainstream as a result of declining costs in underlying core technologies. Declining costs mean unlocking exponentially larger markets, wider applications, and ultimately more profits for investors. Whether it is batteries for electric vehicles, AI for computing, or genome sequencing for healthcare, this is clearly a sound philosophy when applied correctly.\nThere is no doubt there are serious cost declines happening in the space industry. SpaceX (SPACE) has spearheaded this with their reusable rockets reducing the cost of sending payloads to LEO (low-earth orbit) to $2720/kg (Elon Musk has even ambitiously stated goals of eventually bringing this all the way down to $10/kg). For context, the Space Shuttle program was over 6X more expensive even at its cheapest point, charging $18,000/kg for comparable trips. We've established space is experiencing revolutionary cost declines and ARK definitely shares this view, yet it is important to assess whether we are truly at an inflection point and evaluate how accessible space is from an investment perspective.\nUnlike electric vehicles where there are many companies successfully riding the coattails of Tesla's (TSLA) leadership, space is a very different beast. Space companies are burdened with astronomically front-loaded CapEx as well as complex regulatory hurdles, uncertain and volatile cash flows, plus not to mention - very long time horizons. These factors explain why a company like SpaceX, that is solving some of the most advanced problems in space today, will remain private for the foreseeable future. It also explains why there are just generally not that many companies taking on highly ambitious projects in space.\nEven for the small handful of public companies working on space exploration projects, these projects are predominantly in the development stage. They also make up a relatively minor segment of revenue when we're considering the likes of Boeing (BA) or Lockheed Martin (LMT). All of this lends to the reality that there is a very small pool of companies that ARK can call their investable universe for a Space Exploration fund.\nWhat's Under The Hood?\nMaybe I'm being a bit presumptuous, but I have a strong feeling there are many eager ARK fans, reddit investors, Robinhoodies, etc. who will be buying ARKX with visions of profiting from Moon tourism, Mars missions, and lucrative space mining. So just for a sobriety check and general informational purposes, I thought it would be good to start by outlining the fund's specific strategy as defined in the prospectus, as well as what the fund will be initially investing in.\nIn terms of the prospectus, ARK states their strategy as follows:\n\n The Adviser defines \"Space Exploration\" as leading, enabling, or benefitting from technologically enabled products and/or services that occur beyond the surface of the Earth.\n\nThis is an important definition to note because, again, I do have this feeling that many folks will have grandiose expectations when it comes to a space-themed ETF. ARK defines space as anything beyond the surface of the Earth meaning drones, missiles, commercial aviation, and satellites are all fair game and have a heavy presence in the fund at inception. \"Benefitting from\" is also a key phrase here as some holdings like Netflix (NFLX) (which clearly seem out of place in a space fund) fall under this category.\nWhile this all technically falls within the realm ofspaceaccording to ARK's definition, it really seems that theexplorationpart of \"Space Exploration ETF\" is a bit of a misnomer. Space Exploration would imply to most investors that the fund is targeting the frontier of space exploration technology (as in beyond Earth), but perhaps this will be more applicable in the future when there is a wide enough pool of relevant public companies to invest in.\nDiving deeper into the holdings, the ETF is exposed to the following segments which are described in more detail below:\nSource: ARK Invest\n\nOrbital Aerospace Companieslaunch, make, service, or operate platforms in the orbital space, including satellites and launch vehicles.\nSuborbital Aerospace Companieslaunch, make, service, or operate platforms in the suborbital space, but do not reach a velocity needed to remain in orbit around a planet.\nEnabling Technologies Companiesdevelop technologies used by Space Exploration-related companies for successful value-add aerospace operations. These operations include artificial intelligence, robotics, 3D printing, materials, and energy storage.\nAerospace Beneficiary Companiesoperations stand to benefit from aerospace activities, including agriculture, internet access, global positioning system (GPS), construction, imaging, drones, air taxis, and electric aviation vehicles.\n\nTop Holdings\nSource: ARK Invest\nTaking a more granular look at the actual holdings in the fund, a few things stand out immediately. First of all, the fund has a solid stake in 3D printing via the 3D Printing ETF. This doesn't come as much surprise since ARK views Aerospace as the biggest area of opportunity for the upcoming 3D printing boom:\nSource: ARK Invest\nThis is actually a view I'm pretty aligned with, as aerospace requires a lot of flexibility in terms of materials and design, which 3D printing facilitates. GE, for example, has had some of the earlier successes in aerospace by 3D printing fuel nozzles. The fund's biggest holding, Trimble (TRMB), also has links to the 3D printing world due to their CAD software, similarly with Dassault (OTCPK:DASTY) who makes up a smaller portion of the fund. Drones also take a couple spots via Chinese e-commerce company JD.com (JD) and Workhorse (WKHS). And then there are companies like Deere & Co. (DE) and Netflix, as previously mentioned, that will confuse some investors. The rationale here is that John Deere uses satellites for crop monitoring and GPS for autonomous farming, while satellite constellations could greatly increase Netflix's potential audience.\nMoving down the holdings list, we see some more \"building blocks\" for the space industry like GPU manufacturer NVIDIA (NVDA), or electric giant Honeywell (HON). One thing I will say is that ARK is definitely adding value here by selecting for key players behind the scenes in the space industry. At least from my own research, I find the industry to be a bit more opaque than others so I find quite a bit of value in a manager that is actively identifying important industry relationships.\nAnother standout category is reflected by several defense companies like Kratos (KTOS), L3Harris (LHX), and Lockheed Martin. Defense is a natural complement to aerospace companies, but, again, this highlights how some of the largest holdings in the fund have a minority exposure to space and aren't commercially active on the exploration side of things. On that topic, I was quite surprised Virgin Galactic (SPCE) didn't get a bigger allocation in the fund. Virgin Galactic is probably one of the best aligned public companies with the theme of space exploration and also has promising potential beyond space tourism in the form of hypersonic flight. Hypersonic flight was one of the key areas of opportunity in orbital aerospace identified by ARK in their 2021 Big Ideas report, where they outlined a potential market of $270B in annual revenues at stake.\nA Future For ARK & Space\nI think there are lots of opportunities ahead that could make space an interesting investment theme, broad enough for an ETF product. A decade ago, Tesla had just IPO'd and some of its top competing startups of today like Xpeng (XPEV) and NIO (NIO) had not even been conceived - plus Ford (F), GM (GM), VW (OTCPK:VWAGY) and the rest of the automotive giants had barely blurted the acronym \"EV\". Today looks much different for the EV world and I think similarly a decade from now, we will be saying the same for space.\nThere are already some exciting things in the works. Another area of opportunity for orbital aerospace according to ARK's Big Ideas report is satellite broadband, where they forecast potential for $100B annual revenues in the medium term. SpaceX is likely to spinoff their telecommunications venture and satellite constellation Starlink in the near future, who has a massive lead on satellite broadband. Starlink would of course be a prime candidate for ARKX. And then there is Virgin Orbit who is looking to go public soon via the SPAC route, as well as other interesting private companies like Planet Labs who could IPO in the near future.\nMore importantly, however, like Xpeng and NIO, there are many great space companies yet to be born. As space exploration detaches from its government roots, there will be lots of progress to be made in the next decade and beyond. It is nearly certain we will see a mission to Mars in the next few years and the ensuing shift could be colossal.\nAlternatives\nThe main issue with ARKX is that it is simply constrained by reality, as it is near impossible to get pure exposure to space (at least in public markets). A solution to this is investing in funds like Baron's Focused Growth or Partners Funds, which each have just under 5% exposure to SpaceX. Another option with similar exposure and a pretty neat structure is the Sharespost 100 Fund,which invests in 100 of the largest private companies. While 5% may not sound like much, if you weigh this against a basket of aerospace conglomerates like Boeing, Lockheed Martin, and L3Harris, you're getting comparable exposure with a much better player in the game with SpaceX (Ron Baron also happens to be one of my favorite investors). If you're looking to participate as an investor in the frontier of space, these are truly your best bets for the time being.\nIn Closing\nDespite the tone of this article, I do not believe ARK's intentions with this ETF launch are opportunistic (Jim Cramer was a bit harsh in his perception of ARKX on Mad Money). It is important to note ARK was already operating a space mutual fund and sub-advising on a space fund. The launch of this ETF was inevitable, so perhaps the timing is better labeled as strategic, rather than opportunistic.\nARK's purpose within the investment world transcends bringing returns to investors. In a way, ARK serves as a medium between today and possible futures by helping to fulfill progress through capital and knowledge. On one end they are a vessel for information - Mavens, as Malcolm Gladwell would say, deciphering our complex world and future while broadcasting their findings to the public. They also pave the way for promising technologies by bridging the gap between leading innovators and capital, through their products. In the spirit of this ethos, while I believe it is too early to gain significant exposure to space exploration, the fund launch is setting a trajectory for the future. Keep an eye on the modern space race and set your entry point accordingly.","kind":"news","is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"0","news_tag":"","news_rank":0,"symbols":[],"gpt_button":1},"commentList":[{"id":108529102,"gmtCreate":1620043343606,"gmtModify":1704337757592,"author":{"id":"3579141181798233","authorId":"3579141181798233","name":"Turtlebizkit","avatar":"https://community-static.tradeup.com/news/383fc0f5f93cfdc0a9cf57b2be727129","vip":1,"hat":"https://static.tigerbbs.com/b073a07f77dbe6b3bec6b12311fde6bd","crmLevel":2,"crmLevelSwitch":0,"idStr":"3579141181798233","authorIdStr":"3579141181798233"},"htmlText":"[Sly]&nbsp;","listText":"[Sly]&nbsp;","text":"[Sly]","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/108529102","repostId":1179835136,"repostType":2,"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"langContent":"EN"},{"id":108265024,"gmtCreate":1620031673068,"gmtModify":1704337617133,"author":{"id":"3582461179498852","authorId":"3582461179498852","name":"Jloong","avatar":"https://static.tigerbbs.com/c4b2ad914ca2d224c8a40f6783470de6","vip":1,"hat":"https://static.tigerbbs.com/0a8758340a08196056f8bc1e54805193","crmLevel":4,"crmLevelSwitch":1,"idStr":"3582461179498852","authorIdStr":"3582461179498852"},"htmlText":"[微笑]&nbsp;","listText":"[微笑]&nbsp;","text":"[微笑]","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":1,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/108265024","repostId":1179835136,"repostType":4,"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"langContent":"CN"},{"id":108677298,"gmtCreate":1620025342614,"gmtModify":1704337540358,"author":{"id":"3578121263568403","authorId":"3578121263568403","name":"liew927","avatar":"https://static.tigerbbs.com/dad082438d313bd69b2d42c5c0b6b2e9","vip":1,"crmLevel":1,"crmLevelSwitch":0,"idStr":"3578121263568403","authorIdStr":"3578121263568403"},"htmlText":"jjzjs","listText":"jjzjs","text":"jjzjs","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/108677298","repostId":1179835136,"repostType":4,"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"langContent":"EN"},{"id":108678425,"gmtCreate":1620024561967,"gmtModify":1704337534378,"author":{"id":"3567511757211423","authorId":"3567511757211423","name":"Money Sprout","avatar":"https://community-static.tradeup.com/news/a90f46b85a1738ed3c9b09de55cb7371","vip":1,"hat":"https://static.tigerbbs.com/b073a07f77dbe6b3bec6b12311fde6bd","crmLevel":8,"crmLevelSwitch":1,"idStr":"3567511757211423","authorIdStr":"3567511757211423"},"htmlText":"It does’nt hve that many space stocks in the firstplace","listText":"It does’nt hve that many space stocks in the firstplace","text":"It does’nt hve that many space stocks in the firstplace","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/108678425","repostId":1179835136,"repostType":4,"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"langContent":"EN"},{"id":108658283,"gmtCreate":1620021725742,"gmtModify":1704337506127,"author":{"id":"3573623220650432","authorId":"3573623220650432","name":"Daniel Tay","avatar":"https://static.tigerbbs.com/084a34a7e85f0f077a0253b0ee1a1dbc","vip":1,"hat":"https://static.tigerbbs.com/b0a2963eb37c60c5d6d4a8dbcd266952","crmLevel":5,"crmLevelSwitch":1,"idStr":"3573623220650432","authorIdStr":"3573623220650432"},"htmlText":"Likes and comment pls, thanks&nbsp;","listText":"Likes and comment pls, thanks&nbsp;","text":"Likes and comment pls, thanks","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/108658283","repostId":1179835136,"repostType":4,"isVote":1,"likeStatus":false,"favoriteStatus":false,"reportStatus":false,"tweetType":1,"langContent":"EN"}],"hasMoreComments":true,"newsSizeData":{"likeSize":22,"commentSize":5,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false}}