September, 2023
The Fund underperformed broad based global equities during the month (net).
Key contributors to absolute performance:
• UiPath shares appreciated after the company posted an earnings beat in the second quarter, delivering year-over-year revenue growth of 18.6%. UiPath Inc. provides an end-to-end automation platform that offers a range of robotic process automation solutions.
• Palantir shares saw gains after the company secured a contract with the U.S. Army to conduct research and development services in the area of artificial intelligence and machine learning. Earlier in the month, Palantir entered into an enterprise agreement with Babcock International Group to strengthen the latter’s digital defense capabilities through Palantir AIP.
• Roblox shares rallied on the back of a bullish investor pitch. Roblox provides a creator-first digital entertainment platform and a 3D engine, both of which allow third-party developers around the world to create games and experiences for users.
• Meta Platform shares rose after an analyst opened up a 90-day positive catalyst watch ahead of the Meta Connect event. The analyst predicted that more of Meta’s generative artificial intelligence plans, as well as next quarterly results could be revealed then.
• Verve Therapeutics shares saw gains after the company confirmed that data from a Phase 1 trial for its gene editing drug VERVE-101 would be presented at a medical event in November. VERVE-101 is an invivo gene editing therapy targeted at the cardiovascular disorder heterozygous familial hypercholesterolemia (HeFH) in the company's ongoing heart-1 Phase 1b clinical trial
Key detractors from absolute performance:
• Block shares dipped after the company disclosed that the CEO of Square, Alyssa Henry, will depart on October 2nd. Jack Dorsey will step in to manage the seller ecosystem division.
• Roku shares slipped following an analyst downgrade which cited concerns over valuation and slowing revenue growth. Roku is a connected television (CTV) operating system and hardware provider that distributes various streaming platforms to millions of households globally.
• Gingko Bioworks shares along with other genome names were down as part of a greater market rotation out of the sector this month. Ginkgo Bioworks announced a partnership with Factorial Biotechnologies to develop a novel enzyme for use in Factorial’s single-cell next-generation sequencing library prep kit.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/ARK-Global-Disruptive-Innovation-Fund-Sept-2023.pdfAugust, 2023
The Fund underperformed broad based global equities during the month (net).
Key contributors to absolute performance:
• Archer Aviation shares soared after the company reported its second quarter earnings, reiterated plans to begin commercialisation of its flying taxis in 2025. Archer also shored up its balance sheet with USD 215 million investment from key partners like Stellantis, Boeing, and United, which ARK was able to participate in. Archer Aviation is an aerospace company aiming to revolutionise mobility with its electric vertical takeoff and landing (eVTOL) products and services.
• Nvidia delivered on stronger than expected second quarter results and guidance. Later in the month, Google announced that its A3 supercomputer virtual machines powered by Nvidia’s H100 Tensor Core GPUs should be available next month.
• Spotify shares appreciated on little company-specific news. ARK believes Spotify will continue to grow its share in the music stream space, in addition to building out its podcasting capabilities.
• Intuit shares rallied after delivering a fourth quarter earnings beat, delivering stronger-than-expected top and bottom lines. However, the stock later retreated after delivering soft guidance for its fiscal first quarter. Ark observe that Intuit has made capital investments into AI, which Ark believe will drive a two-sided financial management ecosystem for both consumers and businesses.
• MercadoLibre posted strong earnings for the second quarter and cited Brazil and Mexico as the major contributors to profit growth with solid operational KPIs, strong monetization, and cost efficiency. Later in the month, MercadoLibre appointed a new CFO.
Key detractors from absolute performance:
• Shares of Block declined on relatively little company specific news. ARK believes Block is uniquely positioned to combine its seller and consumer ecosystems in the future, unlocking potential value unobtainable by other fintech firms.
• Shares of Roku declined after an investment firm downgraded the stock from “Buy” to “Neutral”, stating that any coming reacceleration in revenue in 2024 was "priced in". Roku is a connected television (CTV) operating system and hardware provider that distributes various streaming platforms to millions of households globally.
• Shares of Coinbase traded down following the announcement of the company’s third-quarter results, which included a smaller loss than expected and stronger than expected revenue.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/ARK-Global-Disruptive-Innovation-Fund-Aug-2023.pdfJuly, 2023
The Fund outperformed broad based global equities during the month (net).
Key contributors to absolute performance:
• Roku rallied after the company released its secondquarter results. Roku’s platform revenue grew 11% year-over-year, as active accounts increased 16% to 73.5 million and streaming hours jumped 21%. Roku's second-quarter results reaffirm ARK’s conviction in its potential to revolutionize digital streaming and displace linear TV incumbents. Moreover, the company also announced a partnership with Shopify to bring shoppable ads to its users earlier in the month.
• Coinbase and other crypto-related stocks like Block traded up after the company relisted Ripple’s XRP after a landmark ruling by a U.S. District Court, which states that the coin is not a security in terms of sales to the general public. ARK maintains conviction in Coinbase’s leadership across the crypto ecosystem.
• DraftKings appreciated after an analyst upgraded the stock, noting a materially faster ramp of new state openings and higher online betting from parlays and game mix.
• Gingko Bioworks shares rallied after the U.S. Intelligence Community awarded it a contract to develop a biosensor that can track the cellular histories of the microbial genome. As part of the collaboration, Gingko also intends to develop processes to retrieve this data so that the microbe's past exposures can be analyzed.
Key detractors from absolute performance:
• Roblox traded down following relatively little company specific news. Roblox provides a creatorfirst digital entertainment platform and a 3D engine, both of which allow third-party developers around the world to create games and experiences for users.
• Materialise shares fell following a earnings miss. Second quarter earnings disappointed, with GAAP EPS of -$0.01, down 150% since reporting $0.02 per share in the same period a year ago, despite yearover-year revenue growth of 11.6%. The company maintained its previous revenue and adjusted EBITDA guidance for the rest of 2023. Materialise is a company in the 3D printing / additive manufacturing sector.
• 3D Systems continued to trade down after it announced its intention to acquire Stratasys last month. The company is targeting Aug 4th for the completion of talks with Stratasys. ARK continues to monitor these developments closely.
• Beam Therapeutics traded down on relatively little company-specific news. Beam Therapeutics is a clinical stage pharmaceutical company developing gene editing therapies that employ a cutting-edge, next generation base-editing technique, which could be beneficial for allowing less off-target edits.
• Pacific Biosciences of California traded down on relatively little company-specific news. ARK believes that PacBio, which is already the dominant supplier of long-read sequencing (“LRS”) instruments and consumables, is well positioned to capitalise on what ARK predicts will be a continued growth trend in the demand for LRS.
June, 2023
The Fund outperformed broad based global equities during the month (net).
Key contributors to absolute performance:
• Tesla shares rallied after the company opened its Supercharger network to General Motors and Ford. Later in the month, SAE International, an automotive industry body that sets and reviews engineering standards, announced that it would standardize Tesla’s North American Charging Standard connector.
• Unity shares soared after the company unveiled its artificial intelligence (AI) marketplace. The stock was also upgraded to “outperform” by an analyst, citing a meaningful mobile cross-sell opportunity, cost synergies, and an increasing total addressable market.
Key detractors from absolute performance:
• CRISPR Therapeutics detracted from performance this month. CRISPR and Vertex Pharmaceuticals announced that their Biologics License Applications for gene-edited blood disorder candidate exa-cel has been accepted by the FDA. The FDA has issued a Priority Review for its BLA in severe sickle cell disease with a target action date on December 8, 2023, and a standard review for that in transfusiondependent beta-thalassemia with a target action date on March 30, 2024.
• Twilio depreciated on little company specific news. The company agreed to sell its Value First business and allocate its resources to other strategic priorities. Twilio is a leading provider of customer-focused IP and programmatic communications with developerfriendly APIs, global connectivity, and industryleading reliability.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/ARK-Global-Disruptive-Innovation-Fund-Jun-2023.pdfMay, 2023
The Fund outperformed broad based global equities during the month (net).
Key contributors to absolute performance:
• Tesla shares rallied following a positive response to the company’s annual shareholder meeting, where co-founder J.B. Straubel was elected to the board of directors. The company reaffirmed its promise to deliver its first Cybertrucks this year, and announced that the company will begin advertising.
• CRISPR Therapeutics shares rallied on the back of strong first quarter results. The Swiss biotech reported $100 million in revenue from its collaboration with Vertex Pharmaceuticals ahead of a potential FDA review for the gene-editing therapy exa-cel.
Key detractors from absolute performance:
• Shares of Teladoc traded down on relatively little company-specific news. ARK believes Teladoc's focus on data science at scale across multiple care categories (e.g. acute, ambulatory, and chronic settings) will offer the broadest, most entrenched care package in the virtual healthcare market.
• 2U missed its first quarter earnings and faces some regulatory uncertainty, which caused the stock to depreciate. In ARK’s view, 2U’s cloud infrastructure offers the best online education platform in the US and perhaps the world. ARK believes that its acquisition of edX, a massive online course provider created by Harvard and MIT, will be game-changing. 2U's ability to help institutions lower costs should put it in a good light as the US reviews the regulatory framework around education.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/ARK-Global-Disruptive-Innovation-Fund-May-2023.pdfApril, 2023
The Fund underperformed broad based global equities during the month (net).
Key contributors to absolute performance:
• DraftKings shares appreciated on the back of Wall Street analysts becoming more optimistic about the company’s first quarter earnings. Given its plans to launch in Puerto Rico, ARK believes DraftKings will deliver another year of rapid growth. DraftKings is a sports betting, iGaming, and fantasy sports platform.
• Shares of CRISPR Therapeutics and other geneediting names, like Intellia Therapeutics, rallied as Wall Street analysts issued bullish views, noting that the sector had been disproportionately punished. Moreover, the company, alongside Vertex Pharmaceuticals, also completed a rolling submission of a Biologics License Application to the FDA for exagamglogene autotemcel (exa-cel) for sickle cell disease and transfusion-dependent beta-thalassemia.
• Schrodinger shares rallied on the back of little company-specific news. Schrodinger specializes in developing computational tools and software for drug discovery and materials science.
• Teladoc shares traded up after it announced the launch of its provider-based care for weight management and prediabetes for the third quarter. Moreover, the company beat its first quarter earnings, citing a 11% YoY revenue growth.
February, 2023
The Fund outperformed broad based global equities during the month (net).
Key contributors to absolute performance:
• Tesla shares saw gains on signs that recent price cuts are spurring demand for its Model Y. The stock also rallied after Ford announced that it halted production and shipments of its electric F-150 Lightning pickup due to a battery issue. Lastly, the Mexico President held a call with Tesla in anticipation of the announcement of a new plant near Monterrey. This will be one of eight new Gigafactories as part of the company’s goal to produce 20 million vehicles a year by the end of 2030.
• Roku shares rallied after the company delivered a fourth quarter earnings beat, topping Wall Street expectations. During the quarter active accounts jumped 16% year over year, and streaming hours rose 23% year over year. The company also reaffirmed its commitment to deliver positive adjusted EBITDA in 2024 through a combination of operating expense control and revenue growth.
Key detractors from absolute performance:
• Shopify traded down after the company reported fourthquarter earnings. Gross merchandise volume (GMV) across Shopify merchants and total revenue grew 13% and 25%, respectively, on a year-over-year basis. For the first quarter, management expects total revenue growth to decelerate to the high teens. That said, Shopify has developed several business lines that could reaccelerate growth—Shopify Fulfilment Network and Shopify Components—as could the continued adoption of Shop Pay and a cyclical rebound in ecommerce demand.
• Unity Software traded down after the company's fourth quarter report, which included recently acquired ironSource, revenue growth was 43% year-over-year and, according to management, will accelerate in the range of 47% to 50% in the first quarter and 47% to 58% for the year, both growth rates were lower than consensus expectations. Management explained that the assumptions behind those forecasts are conservative, including no recovery in the mobile gaming market even though it seems to have stabilized. Meanwhile, strong execution has increased non-gaming to 30% of Create revenue. ARK’s conviction remains high that Unity will maintain leadership as the 2D and 3D asset engine and monetization platform of choice for developers across many verticals.
January, 2023
The Fund outperformed broad based global equities during the month (net).
Key contributors to absolute performance:
• Roku shares rallied after the company announced it surpassed 70 million active accounts globally, marking a 16% YoY growth. Roku also announced plans to release its own line of TVs this year. ARK believes Roku is a dominant player in the connected TV space, and it continues to operate the most successful independent TV OS in the U.S.
• Tesla rallied on the back of strong fourth quarter results, where Elon Musk told investors that Tesla had the ability to produce up to 2 million vehicles this year, assuming no hiccups. On that note, the company confirmed that the Cybertruck is on track to start production later in the year in its Austin, Texas factory. The company also provided an optimistic outlook on profits, citing that hardware-related profits are expected to be accompanied by an acceleration of software-related profits. This aligns with ARK’s thesis on autonomous driving. Lastly, the company is slated to share details on its next generation vehicle, which ARK believes could be a purpose-built robotaxi, during its Investor Day in March.
Key detractors from absolute performance:
• Cerus traded down after the company reported earnings and described 2023 as a "bridge year" in which the outlook remains unclear. In ARK’s view, foreign exchange (FX) pressures and inventory issues in the international blood industry are weighing on the short-term outlook. Cerus is a biomedical products company supplying hardware and consumables under its flagship blood transfusion safety brand, INTERCEPT.
• Prime Medicine traded down on relatively little company specific news. Prime Medicine is a biotechnology company committed to delivering a new class of differentiated, onetime, curative genetic therapies to address the widest spectrum of diseases.
December, 2022
The Fund underperformed broad based global equities during the month (net).
Key contributors to absolute performance:
• Exact Sciences rose after its competitor, Guardant Health, published disappointing topline data for a blood-based cancer drug test.
• PagerDuty rallied after the company issued better than expected guidance in its third quarter results, citing a 31% YoY revenue growth. PagerDuty is a SaaS company that helps companies manage alerts and ensure high service quality as well as uptime.
• UiPath rallied on the back of a third quarter earnings beat. The company reported YoY revenue growth and improved gross margins from more disciplined capital allocation and cost management. UiPath provides a suite of robotic process automation (RPA) products that automates complex processes under specified compliance and governance standards.
• Schrodinger rallied after announcing its acquisition of Nimbus Lakshmi, a subsidiary of Nimbus Therapeutics. ARK believes this acquisition will create more business opportunities for Schrodinger as the two have collaborated on various projects in the past, it would also further Nimbus’ existing and future drug discovery programs.
• Prime Medicine rallied on the back of relatively little company-specific news. Prime Medicine is a biotech firm that owns the intellectual property around “prime editing".
Key detractors from absolute performance:
• Tesla declined as sell-side price targets were lowered based on concerns about demand and amid worries that CEO Elon Musk's recent purchase of Twitter could create an ongoing distraction.
• Roku declined on relatively little specific company news. ARK believes Roku is a dominant player in the connected TV space, and that it continues to operate the most successful independent TV OS in the U.S.
• Intellia Therapeutics declined as several sell side analysts slightly reduced their price target for the company of late.
• Unity declined on relatively little specific company news. ARK maintains high conviction in Unity as the real-time 2D and 3D engine platform is well positioned to capture meaningful revenue as the digital landscape shift to a never-ending immersive space.
• CRISPR Therapeutics declined on relatively little company specific news amid a broader selloff impacting gene editing growth names.
November, 2022
The Fund underperformed broad based global equities during the month (net). Key contributors to absolute performance:
• Exact Sciences delivered strong third quarter results and boosted its revenue guidance for the remainder of the year, causing its stock to rally. ARK believes with its breadth of oncology offerings, Exact will remain a leader within the early disease detection space.
• Unity Software saw gains after a better-than-expected CPI print brought about a broader market rally.
• Shopify to rallied on record Black Friday/Cyber Monday results and also benefitted from a better-than-expected CPI.
• Veracyte rallied on the back of a third quarter earnings beat. The company raised its full year revenue and reported a YoY revenue growth of 25%, driven by the success of its Decipher and Afirma tests.
• Block rallied after the company posted record transaction volume over the Black Friday/Cyber Monday weekend, especially through its Buy Now Pay Later service, Afterpay.
October, 2022
The Fund underperformed broad based global equities during the month (net).
Key contributors to absolute performance:
• Zoom Video Communications shares rallied on relatively little company-specific news.
• Shopify rallied following a third quarter earnings beat. The company also provided strong guidance through the end of the year. Shopify is a leading provider of software that makes it easy for any business to list their inventory online and seamlessly sell through their own site, Amazon, Instagram, eBay, and other channels.
• Roblox Corp traded up after the company posted its strongest usage stats (e.g., bookings, hours engaged, daily active users) in nearly a year. Roblox develops and operates an online entertainment platform for customers worldwide.
• Teladoc Health rallied following a third quarter earnings beat on both top and bottom lines. The company posted a YoY increase in revenue and growth in its paid membership.
• Pacific Biosciences of California rallied following the launch of Revio, a more affordable gene-sequencing system that will enable customers to scale the use of the company’s HiFi sequencing technology. PacBio also announced Onso, their new short read instrument, which boasts many on instrument features for faster, more accurate, and higher coverage short read sequencing runs.
September, 2022
The Fund underperformed broad based global equities during the month (net).
Key contributors to absolute performance:
• Ginkgo Bioworks traded up during a broader market rally. The Boston-based synthetic biology company has extensive expertise in developing and optimizing microbes for valuable downstream products in many industries. Ginkgo recently acquired Altar Bio and Circularis, two companies that will further improve their capabilities around adaptive laboratory evolution and gene overexpression.
• Signify Health traded up following news of CVS's interest in acquiring the company. News of the potential acquisition comes after Amazon's recent acquisition of One Medical, suggesting an emerging pattern of consolidation in the digital healthcare space. Signify Health seeks to activate the home as central to healthcare, enabling its members to avoid inefficient and unnecessary medical costs.
• Robinhood rallied following news that the Securities and Exchange Commission may stop short of a full ban on payment for order flows, which has been a meaningful revenue driver for Robinhood.
• TuSimple traded up on relatively little company-specific news. TuSimple is a leading autonomous trucking technology company.
• Twitter rallied upon rumors that Elon Musk and Twitter could settle before the October 17th court date
Key detractors from absolute performance:
• Roku traded down on relatively little company-specific news. ARK believes Roku is a dominant player in the connected TV space, and it continues to run the most successful independent TV OS in the U.S.
• Unity Software dipped after AppLovin withdrew its initial bid to acquire the company, citing that AppLovin’s path as the "independent market leader" is better for its shareholders.
• UiPath declined after the company cut its revenue outlook for fiscal year 2023, which resulted in a lowering of sell-side price targets and stock ratings. The change in revenue outlook was largely attributed to the impact of foreign currency exchange rates.
• Block depreciated as analysts downgraded the stock during the month, citing concerns around its seller and Afterpay businesses, as well as the company’s growth path.
• Teladoc Health were pressured by a general downward movement in the broader markets. There was relatively little company-specific news.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/Nikko-AM-Ark-GDI-Fund-Sept-2022.pdfAugust, 2022
The Fund underperformed broad based global equities during the month (net).
Key contributors to absolute performance:
• Signify Health traded up following rumours of CVS’s interest in acquiring the company. News of the potential acquisition comes after Amazon's recent acquisition of One Medical, suggesting an emerging pattern of consolidation in the digital healthcare space. Signify Health seeks to activate the home as central to healthcare, enabling its members to avoid inefficient and unnecessary medical costs..
• Unity Software rallied following the announcement of AppLovin's all-stock offer to buy Unity in an attempt to stop the Unity/ironSource merger, which was set in motion in July. Unity rejected the bid, stating that the merger agreement with ironSource provided better value to Unity shareholders.
• Invitae reported 17.5% revenue growth this quarter. Management attribute this rapid improvement to several initiatives they have been implementing to establish Invitae as the global leader in delivering personalized, geneticallydriven healthcare.
Key detractors from absolute performance:
• Zoom traded down after the company reported secondquarter earnings, which beat consensus expectations for EPS but missed on revenues.
• Exact Sciences traded down on relatively little companyspecific news. The company posted strong second quarter results earlier in August but lowered its guidance for FY22.
• CRISPR Therapeutics slid on the back of an earnings miss in the second quarter. The company missed EPS and revenue by $0.19 and $2.04M (down 100% YoY), respectively.
• Teladoc Health fell following a downgrade by Wall Street analysts, who raised concerns about near term performance.
July, 2022
The Fund outperformed broad based global equities during the month (net).
Key contributors to absolute performance:
• Tesla rose in early July after it was announced that the company sold 78,000 of its Chinese-produced vehicles in June. That figure represents a 142% leap from May and a 135% jump from 2021. On the earnings call, Elon Musk said that the company aims to produce 40,000 vehicles a week by the end of this year.
• Shares of CRISPR Therapeutics and Intellia Therapeutics traded higher alongside what ARK believes was a meaningful market rotation into growth stocks led by the biotech segment. Biotech stocks generally are considered "high growth" and tend to perform better in a subdued interest rate environment. ARK also believes we may be seeing the beginning of a new trend of M&A consolidation in the biotech sector.
Key detractors from absolute performance:
• Roku fell after the company missed both revenue and earnings estimates in its second quarter report. Management withdrew full-year revenue guidance, citing a slowdown in the growth of advertising budgets and a pull-back in consumer discretionary spending, and lowered guidance for third quarter revenue growth to 3% on a year-over-year basis.
• Zoom traded lower on relatively little company-specific news.
June, 2022
Key contributors to absolute performance:
• Intellia Therapeutics, recent receipt of an orphan drug label designation for NTLA-5001, which targets acute myeloid leukaemia, is a positive development. • Veracyte demonstrated the efficacy of its Afirma Genomic Sequencing Classifier to improve the accuracy of thyroid cancer diagnosis. The pioneer in gene expression-based prognostic testing is one of the most vertically integrated molecular testing companies on the market. In ARK’s view, its decentralized testing portfolio (assays and instruments) should position the company to win a significant share within and beyond the US.
Key detractors from absolute performance:
• Coinbase Global depreciated amidst a broad crypto selloff triggered by events including the collapse of Terra/Luna, and liquidity issues at Celsius, among others. ARK maintains seem to have lured risk-averse benchmark-sensitive investors into crowded trades, and away from many emerging growth opportunities centred on disruptive innovation.
Investors in broad-based equity indexes seem to be shorting innovation, perhaps inadvertently and, if history is any guide, to their detriment. As a result, they could be missing the next Amazon, Apple, or Tesla. In the last 15 to 25 years, these companies invested aggressively at the expense of short-term profits. Amazon disrupted the legacy brick and mortar retail market and captured a disproportionate share of the e-commerce opportunity. In the early days, Wall Street also missed the potential of Apple’s iPhone to disrupt Nokia, Samsung, Motorola, and Blackberry and, in the last five years, many investors denigrated bitcoin and crypto-assets as Ponzi schemes. For many years, traditional auto analysts proclaimed that Tesla was doomed to failure: they did not understand that Tesla was a robotics, energy storage, and artificial intelligence company, not an auto company. Controversial and volatile in the short-term, companies focused on innovation that solves problems and disrupts legacy industries can surprise with significant exponential growth trajectories.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/Nikko-AM-Ark-GDI-Fund-Jun-2022.pdfApril, 2022
The Fund underperformed broad based global equities during the month (net).
Key contributor to absolute performance:
• Twitter traded up meaningfully during the month after Elon Musk disclosed a significant stake which evolved into, pending approval, an outright purchase of the company. Musk is a visionary entrepreneur and an active Twitter user whose appointment to its Board of Directors could benefit the company in unexpected ways.
Key detractors from absolute performance:
• Teladoc Health the largest, global digital health platform, fell significantly after its quarterly earnings report. ARK believes the primary reason for the sudden stock decline was Teladoc's 25% reduction in 2022 adjusted EBITDA guidance owing to a decrease in marketing yield in one of Teladoc's DTC mental health channels.
• Coinbase Global traded down alongside crypto markets. ARK believes Coinbase has emerged as the premier regulatory-compliant cryptocurrency exchange and should be a prime beneficiary as the opportunity for crypto-assets evolves.
• Tesla detracted from performance despite a strong earnings report that featured record deliveries and operating margin. The company unveiled plans to produce a steering-wheel-less and pedal-less robotaxi vehicle in 2024, a much stronger commitment to robotaxi commercialization than the company has made to date.
January, 2022
The Fund underperformed broad based global equities during the month (net). Key contributors to absolute performance: • There were no contributors to absolute performance this month, given innovation stocks were disproportionately punished during the January market sell-off. Key detractors from absolute performance:
• Amidst the market rotation, shares of Roku detracted as bearish analyst reports emerged and as the head of its Platform business announced his departure. ARK maintains very high conviction and is focused on Roku’s potential to increase the monetization of its user base. • Unity traded lower after experiencing a large increase in its stock price through to November 2021. Despite the drawdown during the month, Unity announced interesting developments including a partnership with Hyundai Motor to design and build a metaverse roadmap.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/Nikko-AM-Ark-GDI-Fund-Jan-2022.pdfDecember, 2021
Key contributors to absolute performance: • Intellia Therapeutics, a next-generation biopharmaceutical company developing in and ex vivo gene editing therapeutics, contributed to performance on relatively little news during the month. In 2021, Intellia published positive clinical and preclinical results and received an FDA orphan drug designation for one of its gene therapy candidates, positioning it well for 2022 in ARK’s opinion. • Iridium Communications contributed to performance on relatively little news. ARK believes the company will surprise to the upside as its broadband service, Iridium Certus, grows and moves upmarket in the internet-of-things space. It could see widespread adoption by autonomous solutions
Key detractors from absolute performance: • Coinbase Global traded lower during the month, following on from the broader crypto-market decline. • After a relatively strong run, shares of Unity Software gave back gains during December. Shares were pressured as Director David Helgason sold 260k shares (~USD 42 million) early in the month. Investors also reacted negatively upon the announcement of Unity’s acquisition of segments of Weta Digital. ARK, in contrast, looks at the acquisition as amenable to Unity’s expansion into high-performance game
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/Nikko-AM-GS-Fund-Dec-2021-1.pdfOctober, 2021
Key contributors to absolute performance:
Tesla crossed a one trillion US dollar market valuation after continued momentum in sales, a positive third-quarter earnings release, and Hertz announced a 100,000 vehicle order.
Coinbase Global appreciated following the company’s announcement of plans to launch a peer-to-peer nonfungible token (NFT) marketplace, which will broaden its crypto-focused product suite. Coinbase should be able to diversify its revenue stream from brokerage and custody services with NFTs.
Spotify rallied following the company’s third-quarter earnings report, which beat revenue expectations. Additionally, Spotify partnered with Shopify to add merchandise to artists’ profiles. Teladoc contributed to performance. Total visits accelerated compared to the previous quarter, helping Teladoc beat Wall Street’s thirdquarter expectations. Additionally, management raised forward guidance
Key detractors from absolute performance:
CRISPR Therapeutics shares fell after the company announced updated results from the early-stage trial of its CAR-T cell therapy CTX110. Based on the results, the company plans to expand into a registrational trial in the first quarter of 2022. ARK maintains conviction in CRISPR and its initiatives.
File: https://commentary.quantreports.net/wp-content/uploads/2021/02/Nikko-AM-NA-Fund-Oct-2021-1.pdfDecember, 2020
The Fund outperformed broad based global equities during the month (net).
Key contributors to absolute performance:
• Gene editing stocks rose in December following a plethora of presentations at the American Society of Hematology's Annual Meeting (ASH). Shares of Editas Medicine surged in December after the company presented encouraging data on its pre-clinical, off the shelf, allogeneic iNK cells and the manufacturing and development process for its sickle cell and beta thalassemia programs. CRISPR Therapeutics rose in December after the company presented compelling data from its gene editing program CTX-001 for sickle cell and beta thalassemia at the annual ASH meeting. Shares of Interne Therapeutics appreciated in December after the company presented pre-clinical data on its CRISPR/Cas9 TCR-T cell treatment for Acute Myeloid Leukemia (AML). In December, the company also announced the achievement of normal Alpha-1 Antitrypsin protein levels in non-human primates.
• Tesla and Roku also contributed to performance.
Key detractors from absolute performance:
• Invitae underperformed in December most likely because the share lockup expiry date for ArcherDx shareholders occurred earlier in the month. Given Invitae's year-to-date outperformance, we think there could be downward pressure on the stock until Invitae's next corporate update during the JP Morgan Healthcare Conference in early January.
• Seres Therapeutics declined slightly in December after strong performance in the last few quarters, we believe that investors may be worried about clinical trial slowdowns because of new imposed restrictions for COVID-19.
• Veracyte depreciated in December following a period of outperformance in October and November. Since Veracyte's prognostic tests utilise tissue biopsies, investors may be concerned about near-term testing volume growth since many patients still are unable to undergo tissue biopsies in the wake of COVID-19.
• Zoom and Splunk also detracted from performance.
asset_class: Foreign Equity
asset_category: Large Blend - Fundamental
peer_benchmark: Foreign Equity - Large Fundamental Index
broad_market_index: Developed -World Index
manager_contact_details: Array
ticker: NIK1854AU
release_schedule: Monthly
commentary_block: Array
factsheet_url:
https://www.yarracm.com/tools-and-resources/literature-centre/fund-commentaries/
fund_features:
Nikko AM ARK Global Disruptive Innovation provides access to a global equity portfolio that offers thematic exposure to disruptive innovation acorss a number of sectors, economies, geographies and companies.
- The Sub-Fund will invest, under normal market conditions, primarily in global equity securities of companies that are relevant to the Sub-Fund’s investment theme of disruptive innovation.
- The investment objective of the Sub-Fund is to achieve a long term capital growth.
structure: Managed Fund