Key Points
- ARK Invest has sold 108,751 ARKB spot Bitcoin ETF shares to balance its fund weightings.
- The firm also sold part of its shares in Coinbase Global Inc.
ARK Invest, the leading investment asset management firm, has sold 108,751 ARKB spot Bitcoin ETF shares to balance its portfolio. This move by the Cathie Wood-led firm was made on Thursday, with the assets offloaded from its Next Generation Internet ETF (ARKW) amounting to approximately $6.9 million.
ARK Invest’s Diversification Strategy
This sale occurred just a week after ARK Invest sold 118,209 ARKB shares worth a staggering $7.76 million. In addition to this, the spot Bitcoin ETF recorded a net outflow of $22.4 million on Thursday, August 1. It’s worth noting that other Bitcoin ETFs recorded $50.6 million in combined net inflows.
ARK Invest also reduced its holdings in Coinbase Global Inc (NASDAQ: COIN), selling 31,517 shares ($6.7 million) from ARKW and 37,552 shares ($8 million) from its Fintech Innovation ETF (ARKF) on Thursday. This was the largest single-day divestment since May 7.
The firm’s latest trade filing reveals that ARK Invest sold $2.7 million worth of COIN the previous day. In total, the firm liquidated $7.93 million worth of COIN stock in July and $2.88 million of the shares in June.
This strategy is part of ARK Invest’s policy to prevent any single holding from taking up more than 10% of an ETF’s portfolio, ensuring diversity within its funds. As such, it is expected that ARK Invest will continue to rebalance its asset weightings, especially if ARKB and COIN continue to exceed the value of other holdings in the fund.
ARK Invest’s Holdings
As of August 2, ARKB was the largest holding within ARK Invest’s ARKW ETF, with a weighting of approximately 10.6%, representing $142.4 million. Coinbase share COIN, on the other hand, represents only 6.7%, making it the fourth-largest holding in the fund with a total worth of around $90.4 million.
However, COIN is ARK Invest’s largest holding in its ARKF fund, with a 9.7% stake worth $77.4 million. The other top three holdings are ARK’s own spot Bitcoin ETF (ARKB), Tesla Inc (NASDAQ: TSLA), and Roku Inc (NASDAQ: ROKU) shares, with weightages of 11%, 10%, and 8.4% respectively.
Meanwhile, Coinbase recently released its Q2 2024 earnings report, outperforming Wall Street analysts’ expectations. While analysts predicted a total revenue of $1.4 billion, the firm posted $1.45 billion amid a broader market boom.
Coinbase’s subscription and service unit generated a massive $599 million in revenue, pushing the company’s net income to $36 million. This is a significant increase from Q2 2023 when the unit generated $335.4 million, and Q1 2024 when the unit generated $510.9 million.
