SARK launches as short interest in ARKK jumps to new record

SARK launches as short interest in ARKK jumps to new record

The first exchange traded fund to take an inverse exposure to another ETF rose by 5.5 per cent on its first two days of trading, mirroring the day’s fall in Cathie Wood’s flagship $21bn Ark Innovation ETF (ARKK).

Tuttle Capital Management’s Short Innovation ETF (SARK) listed on Nasdaq on Tuesday with the aim of providing the inverse returns, on a single day’s basis, of ARKK.

Its trading volume of $843,000 on day one comes as short interest in ARKK has shot up to a new record of 17.3 per cent of its shares, with a market value of $3.7bn, currently being borrowed by investors betting on a sell-off, according to S3 Partners, a specialist data provider. This is up from just 2 per cent at the turn of the year and 15.3 per cent a month ago.

The Ark fund has enjoyed a phenomenal run as the highest-profile vehicle riding the continued rise of the US’s mighty technology sector. Its shares have surged 246 per cent since the lows of March 2020, with its assets jumping from just $2bn over the same period.

However, amid increasingly stretched valuations for its key holdings such as Tesla, Coinbase, Zoom and Zillow, more market participants have been