Research > ETFs > ETF / ETP Commentary > 

'ARKF' and the Shifting Payments Landscape

How consumers pay for goods was changing long before the coronavirus pandemic, but the global health crisis has accelerated the growth of fintech.That’s one reason why the ARK Fintech Innovation ETF (ARKF) is up almost 41% over the past 12 months. Obviously, that’s past performance and is not guaranteed to repeat, but what isn’t up for debate is ARKF’s status as an exchange traded fund at the forefront of a payments revolution – one that’s shaping up to be durable and sustainable.“The power dynamics in the payments industry are changing as businesses and consumers shift dollars from cash and checks to digital payment methods. Cards dominate the in-store retail channel, but mobile wallets like Apple Pay are seeing a rapid uptick in usage and paving the way for the future of payments,” according to Insider Intelligence.Apple (NASDAQ: AAPL) isn’t one of ARKF’s holdings, but the fund is actively managed, so that could change and ARKF does have a small allocation to Alphabet (NASDAQ: GOOG), the purveyor of the Google Pay digital payments platform.Additionally, digital wallets are increasingly prominent parts of the peer-to-peer payments landscape. ARKF taps into that trend in earnest by way of a combined 16% weight to Square (NYSE: SQ) and PayPal (NASDAQ: PYPL), the companies behind the popular Cash App and Venmo digital wallets.The use of digital wallets has increased exponentially against the backdrop of the coronavirus pandemic. Yet the long-term thesis for this fintech segment is also sturdy.“The digitization of payments isn’t just contained to retail, though, with real time mobile P2P payments, digital remittances, and digital business payments continuing to blossom as change spreads through the ecosystem. Mobile proximity payment volume accelerated to $131.36 billion,” adds Insider Intelligence.Predictably, online shopping is fertile territory for some ARKF holdings too.“At the same time, e-commerce will chip away at brick-and-mortar retail as smartphones attract a rising share of digital shopping. Digital peer-to-peer (P2P) apps are supplanting cash in the day-to-day lives of users across generations as they become more appealing and useful than ever,” continues Insider Intelligence.ARKF holdings levered to that theme include Shopify (NYSE: SHOP), Facebook (NASDAQ: FB), and Amazon (NASDAQ: AMZN), among others. That trio combines for about 10% of the ARK fund’s weight.The $4 billion ARKF usually holds 35 to 55 stocks and charges 0.75% per year.For more on disruptive technologies, visit our Disruptive Technology Channel.

Performance data shown is past performance and is no guarantee of future results. Current performance may be higher or lower than the performance data quoted. Yield and return will vary, therefore you have a gain or loss when you sell your shares. For standard quarterly performance, go to the fund's Snapshot page by clicking on the ETF/ETP's symbol.

ETFs may trade at a premium or discount to their NAV and are subject to the market fluctuations of their underlying investments.

For iShares ETFs, Fidelity receives compensation from the ETF sponsor and/or its affiliates in connection with an exclusive long-term marketing program that includes promotion of iShares ETFs and inclusion of iShares funds in certain FBS platforms and investment programs. Please note, this security will not be marginable for 30 days from the settlement date, at which time it will automatically become eligible for margin collateral. Additional information about the sources, amounts, and terms of compensation can be found in the ETF's prospectus and related documents. Fidelity may add or waive commissions on ETFs without prior notice. BlackRock and iShares are registered trademarks of BlackRock, Inc. and its affiliates.

FBS receives compensation from the fund's advisor or its affiliates in connection with a marketing program that includes the promotion of this security and other ETFs to customers ("Marketing Program"). The Marketing Program creates incentives for FBS to encourage the purchase of certain ETFs. Additional information about the sources, amounts, and terms of compensation is in the ETF's prospectus and related documents. Please note that this security will not be marginable for 30 days from the settlement date, at which time it will automatically become eligible for margin collateral.

News, commentary (including "Related Symbols") and events are from third-party sources unaffiliated with Fidelity. Fidelity does not endorse or adopt their content. Fidelity makes no guarantees that information supplied is accurate, complete, or timely, and does not provide any warranties regarding results obtained from their use.

Any data, charts and other information provided on this page are intended to help self-directed investors evaluate exchange traded products (ETPs), including, but limited to exchange traded funds (ETFs) and exchange traded notes (ETNs). Criteria and inputs entered, including the choice to make ETP comparisons, are at the sole discretion of the user and are solely for the convenience of the user. Analyst opinions, ratings and reports are provided by third-parties unaffiliated with Fidelity. All information supplied or obtained from this page is for informational purposes only and should not be considered investment advice or guidance, an offer of or a solicitation of an offer to buy or sell a particular security, or a recommendation or endorsement by Fidelity of any security or investment strategy. Fidelity does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating ETPs. Fidelity makes no guarantees that information supplied is accurate, complete, or timely, and does not provide any warranties regarding results obtained from their use. Determine which securities are right for you based on your investment objectives, risk tolerance, financial situation and other individual factors and re-evaluate them on a periodic basis.

Before investing in any exchange traded product, you should consider its investment objective, risks, charges and expenses. Contact Fidelity for a prospectus, offering circular or, if available, a summary prospectus containing this information. Read it carefully.