Key Highlights
Recently, the “Magnificent Seven” stocks have generated a total return of about 18% as of mid-October. The Round Hill Magnificent Seven ETF (NYSEMKT:MAGS) has shown decent performance in less than a year, although it does fall short of the remarkable 64% gain seen in mega-cap tech stocks this year.
On the other hand, the Ark Autonomous Technology & Robotics ETF (NYSEMKT:ARKQ), overseen by prominent investor Cathie Wood, focuses on sectors like artificial intelligence, robotics, and autonomous vehicles. This ETF has surged by 56% in 2025.
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There’s substantial proof that ETFs remain a solid choice for long-term investors. The success of the Ark ETF showcases why it’s worth exploring for those considering an unconventional approach to investing in AI and robotics.
A Unique Take on AI Investing
Many AI-focused ETFs lean towards large tech stocks like those part of the Magnificent Seven. However, the Ark Autonomous Technology & Robotics ETF diverges from this norm. Although it’s actively managed by Wood and her team, they specifically seek unique opportunities that often go unnoticed by typical investors.
To put it clearly, Tesla is the largest holding in the fund, which makes it a part of the Magnificent Seven. However, the fund’s top five also includes companies like Kratos Defense & Security Solutions (NASDAQ:KTOS), Teradyne (NASDAQ:TER), Rocket Lab USA (NASDAQ:RKLB), and Archer Aviation (NYSE:ACHR). While some Magnificent Seven stocks are part of this ETF, they don’t dominate its investments. For instance, Amazon.com (NASDAQ:AMZN) and Nvidia (NASDAQ:NVDA) rank as the 13th and 15th largest stocks in the portfolio, which consists of just 36 companies.
Why the Ark ETF Outperformed the Magnificent Seven
In simple terms, many of Ark’s major holdings have outshined other options, with stocks like Kratos and Rocket Lab seeing increases of 239% and 162%, respectively. Palantir (NASDAQ:PLTR) is another notable mention as it’s the sixth-largest holding, up by 134% this year.
Not every stock in the Ark ETF has had such stellar performance, but a lot of them have shown solid gains—some even reaching triple-digit increases.
The Ark ETF’s yield sits at 0.75%. Its expense ratio is somewhat higher than typical index ETFs, meaning you would pay about $7.50 annually for every $1,000 invested. Still, this is comparable to fees seen in other AI-focused ETFs, and recent results speak volumes. Just keep in mind, this fee reflects in performance rather than being a direct charge.
ETFs to Consider
If you’re interested in accessing the artificial intelligence sector and other innovative tech trends without solely relying on mega-cap stocks, the Ark Autonomous Technology & Robotics ETF could be worth investigating. The fund is filled with potential high-growth companies and has performed well this year, suggesting good upside if those main holdings can successfully execute their strategies.
Is Now the Time to Invest in Ark Autonomous Technology & Robotics ETF?
Before jumping into the Ark Autonomous Technology & Robotics ETF, it’s wise to contemplate certain factors:
Our analyst team at Motley Fool Stock Advisor has pinpointed stocks they believe are the Best 10 stocks to purchase right now. Interestingly, the Ark ETF Trust didn’t make the cut, despite the impressive outlook for these 10 stocks over the next few years.
To consider a perspective, if you had invested $1,000 in Netflix when it was first recommended back in December 2004, you’d have seen it balloon to about $667,945. Similarly, investing in Nvidia following its recommendation in April 2005 would have yielded about $1,119,558.
It’s key to highlight that the stock advisor has recorded an average return of 1,073%, outpacing the market significantly compared to the S&P 500’s 191% return. Think about signing up for the latest top recommendations and insights from stock advisor.
The insights expressed here reflect only the author’s view and don’t necessarily represent the stance of Nasdaq, Inc.
