- ARKX provides exposure to a basket of leaders in the space industry, who can displace or create new markets and deliver exponential returns.
- Valuations are stretched across the industry. Most constituents are trading at more than 25x earnings which adds a lot of risk in my opinion in the current market environment.
- Historically, high inflation has a negative impact on P/Es, and richly valued stocks tend to suffer the most.
- All in all, I expect ARKX to continue to underperform the market going forward.
For further details see:
ARKX: Persistent High Inflation A Risk For High-Multiple Stocks