Cathie Wood's Ark Invest has filed for a transparency-themed ETF drawing on Tesla and Apple - but leaving out banks and energy giants

Cathie Wood's Ark Invest has filed for a transparency-themed ETF drawing on Tesla and Apple - but leaving out banks and energy giants
ARK Invest
  • Cathie Wood's Ark Invest filed for transparency-themed ETF on Tuesday, SEC filings show.
  • The fund excludes sectors including banking, fossil fuels, gambling, alcohol and tobacco.
  • If the SEC approves the fund, it would be the second ETF launched by Ark Invest this year.

Cathie Wood's Ark Invest is planning to launch a transparency-themed ETF that will exclude sectors like banking, fossil fuels and gambling, according to a filing made with the Securities and Exchange Commission on Tuesday.

The new fund would closely track a Transparency Index developed by Solactive, with the SEC filing stating it would use a replication strategy - meaning the ETF would invest in tracked companies at a similar proportion to the fund. The fund normally invests at least 80% of its total assets in securities that are included in the benchmark index, the filing said.

The index includes technology companies like Tesla, Apple, Microsoft, Zoom, Netflix and Square, as well as companies from the food and beverage industry like Chipotle and retail heavyweights like Amazon and Nike. Many of these companies are also tracked by Ark Invest's other ETFs, which are generally tech and online heavy.

Industries that will be excluded from the fund include those that are, for example, dangerous to the environment, or manufacture addictive products.

"Companies operating in the following industries, as determined by the Index provider, are excluded from the Index: (i) alcohol, (ii) banking, (iii) chemicals, (iv) confectionery, (v) fossil fuel transportation, (vi) gambling, (vii) metals, (viii) mineral, (ix) natural gas, (x) oil, and (xi) tobacco," the SEC filing says.


Factors that impact whether a company can be added to the index include whether it meets certain transparency criteria, it's involvement in lawsuits and other legal issues as well as the company's public reputation.

Ark Invest had not responded to Insider's request for comment at time of publication.

The transparency characteristic of the fund is in line with Ark Invest's approach to investing - all of the firm's buying and selling activity is published on a daily basis and can be viewed online. This is in stark contrast to the vast majority of investment firms, which prefer to keep their cards close to their chest.

If approved, the Transparency ETF would be the second fund set up by Ark Invest this year after its Space Exploration and Innovation ETF listed in March in one of the most successful fund launches in history. The space-themed fund currently contains assets worth $627 million.

Ark Invest's flagship fund, the Ark Innovation ETF has $25.52 billion in assets under management.