Crypto and Fintech: 2 solid ETFs to buy at the bottom of the wave

Last week, the Federal Reserve (Fed) implemented the largest rate hike in more than twenty years, raising them by 50 basis points. The initial rally following the announcement was followed by a strong multi-day sale on Wall Street.

Then, on May 11, the markets suffered news when Wall Street learned that the consumer price index (CPI) {{ecl-733 ||} had reached 8.3%. (CPI) hit 8.3% in April and the index rose 0.3% last month. Analysts are now wondering whether the Fed can stop inflation without triggering a turnaround in the coming months.

Since the beginning of the year, broader indices and high-growth stocks have come under severe pressure. Financial technology (fintech) stocks and digital assets also saw sharp declines, while the risk-off mood on the street intensified.

For example, the {{986623 | KBW Financial Technology}} index has fallen 28.7% year-on-date (YTD). In comparison, 26.6 per cent fell.

Meanwhile, as we write on Wednesday, the global crypto market value (cap) has dipped to below $ 1.4 trillion. and have lost more than a third of their value so far in 2022.

Such declines are confusing for most retail investors. However, they also mean opportunities for those who want to invest in fintech stocks and digital assets, as well as exchange traded funds (ETFs) that provide access to these asset classes. Therefore, today’s article presents two such funds.

1. ARK Fintech Innovation ETF

  • Current price: $ 15.64
  • 52 week range: $ 15.63 – $ 55.28.
  • Expenditure percentage: 0.75% per year

Our first fund is the ARK Fintech Innovation ETF (NYSE :), actively managed by Cathie Wood. It seeks to achieve long-term capital growth by investing in disruptive financial service companies, ie. companies that offer solutions such as blockchain technology, financing networks or contact platforms with customers.ARKF Weekly

ARKF, which was launched in February 2019, currently has 30 positions. The top 10 names represent about two-thirds of the $ 1.5 billion in net assets. In terms of sector exposure, we see, among others, Information Technology (44.4%), Finance (28.8%) and Consumer Discretionary (12.2%).

Among the top rankings is the digital payment service provider Block (NYSE :); Shopify e-commerce platform (NYSE :); Coinbase Global cryptocurrency exchange (NASDAQ:); the cloud communications platform group Twilio (NYSE :); and the Argentine e-commerce marketplace Mercadolibre (NASDAQ :).

ARKF reached a record high on September 7, 2021. But since then, it has suffered a sharp decline and is changing hands around its lows. The ETF has fallen more than 61.7% year-to-date and 66.7% in the last 52 weeks.

Despite the decline of Wall Street, recent research suggests that the value of the global fintech market is expected to reach:

“$ 324 billion in 2026 with a compound annual growth rate of approximately 25.18% over the 2022-2027 forecast period.”

Therefore, we can expect that many fintech stocks will create shareholder value over the coming quarters. Buy-and-hold investors may consider a fintech-focused fund like ARKF around these levels.

2. Invesco Alerian Galaxy Crypto Economy ETF

  • Current price: $ 9.47
  • 52 week range: $ 9.58 – $ 35.24.
  • Yield: 1.29%
  • Expenditure percentage: 0.60% per year

With digital adoption taking off during the pandemic, cryptocurrencies have also become buzz around the world. Although government agencies and legislators are discussing how to regulate these digital assets, many institutional investors now have crypto in their wallets, and merchants also accept crypto payments.

Therefore, the next on our list today is the Invesco Alerian Galaxy Crypto Economy ETF (NYSE :). It provides exposure to equities in companies that are at the forefront of the crypto area and exchange traded products (ETPs) that focus on crypto.

SATO W1

SATO is a new, small fund that began trading in October 2021. Its net assets are $ 5.8 million. Therefore, investors should keep in mind that the ETF does not have much trading history.

More than 40% of the portfolio is in the top 10 names. Grayscale Bitcoin Trust (OTC 🙂 has the largest share with 16.2%.

This is followed by the Hong Kong-based company Eqonex (NASDAQ :), the British cryptocurrency mining company Argo Blockchain (LON :), the investment company Bitcoin Group (H :), Germany-based and the provider of financial infrastructure solutions, Silvergate Capital. (SNEEZE:).

In terms of sector exposure, we have information technology (60.6%), investment companies (16.2%) and finance (15.8%). More than half of the positions come from the United States, Canada (13.4%) and China (12.3%).

SATO has lost more than half of its value since January and, like ARKF, is currently trading at a record high. Investors looking for diversified exposure to the burgeoning crypto economy should explore SATO further.

Leave a Comment