Cathie Woods Shuts Down an ETF After Just 7 Months

Fund launched last December to track index of well-behaved companies to stop trading next week.

Cathie Woods’ company Ark Investment Management is shutting down its latest fund called ARK Transparency ETF (CTRU) after only 7 months.

CTRU on the Cboe BZX Exchange will stop trading on July 26 and was created to track the stock price movements of the “100 most transparent companies in the world based on a proprietary scoring methodology” developed by Transparency Invest, the provider of the Transparency Index.

The ETF will not accept creation units after July 21.

While the ETF is off by a third since its creation, it is not being closed for its poor performance. Instead, according to a statement from Ark Investments, the closure was forced because the underlying index isn’t going to be calculated any more.

Ark was notified this month”that Transparency Global will stop calculating The Transparency Index effective July 31, 2022. While ARK investigated alternative Index providers, it did not find a suitable solution and decided to close the Fund effective July 26, 2022.”

Transparency did not immediately reply to a request for comment from TheStreet.

The company was founded by Paul Pagnato in 2019. He said the partnership with Ark was “a new paradigm for impact investors,” in a statement at the time Ark launched the ETF in December. 

Pagnato is a board member of Openwater, a medical equipment company, and served as a managing director, private banking and investment group at Merrill Lynch from 1992 to 2011.

ETF’s Weak Performance

The ETF  CRTU has declined by 36.51% year-to-date.  It holds net assets of $13.04 million. The expense ratio was 0.55%.

Trading volume was also thin at 9,926 shares daily.

The top 10 stocks in the ETF were Splunk  (SPLK) – Get Splunk Inc. Report, Five9  (FIVN) – Get Five9 Inc. Report, Natura  (NTCO) – Get Natura &Co Holding S.A. American Depositary Shares Report, Twist Bioscience  (TWST) – Get Twist Bioscience Corporation Report, Omnicell  (OMCL) – Get Omnicell Inc. Report, Evotec  (EVOTF) , Synopsys  (SNPS) – Get Synopsys Inc. Report, AeroVironment  (AVAV) – Get AeroVironment Inc. Report, McCormick & Co MKC and Twilio  (TWLO) – Get Twilio Inc. Class A Report as of March 31. The ETF held 1% in each stock.  

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