ARK Invest To Offer Crypto Separately Managed Accounts (SMAs) to Financial Advisors

On October 03, Cathie Wood’s ARK Invest announced a collaboration with Eaglebrook Advisors to offer its first crypto separately managed accounts (SMAs) to financial advisors and wealth managers.

Through this joint venture, registered clients of the investment advisors will be able to use two different ARK-managed investment strategies: One focused on “Cryptoassets” and another for “Cryptocurrency” investments.

A New Product For Crypto Enthusiasts

Cathie Wood, the founder, CEO, and CIO of ARK said they have been actively working in the crypto space since their founding in 2014 to offer their clients cryptocurrency-related equity and securities investment services.

Therefore, this alliance between Ark and Eaglebrook will expand their reach in the crypto ecosystem, offering new “actively managed crypto strategies to the wealth management industry.”

Wood further emphasized that the strategies will be independently managed through separate accounts to meet the needs of all the parties involved, allowing them to diversify their portfolios gaining exposure to digital assets.

“The strategies will be separately managed accounts (SMAs) designed to meet the needs of financial advisors, wealth managers, and their clients by offering direct ownership, low minimums, and portfolio reporting integration amongst other benefits.”

Christopher King, Founder and CEO of Eaglebrook Advisors explained that ARK will help Eaglebrook drive the crypto industry’s growth by offering easy access to institutional, trust-building cryptocurrency strategies for digital assets.

“Our partnership with ARK will drive this industry forward and deliver institutional access to actively managed crypto strategies to the wealth management market.”

How will ARK’s Investment Strategies Work?

According to the statement, both strategies (the ARK Cryptocurrency Strategy and the ARK Cryptoasset Strategy) will work independently from one another, focusing on different investments. This means that each SMA’s risk exposure (and, of course, the profit opportunity) could change according to the circumstances.

The ARK Cryptocurrency Strategy will cater to investors seeking a “high conviction portfolio,” with investments primarily in top cryptocurrencies such as Bitcoin (BTC) and Ethereum (ETH).

On the other hand, the ARK Cryptoasset Strategy will be a bit riskier, as it will include between 10 to 20 altcoins focused on Smart Contract Networks, Decentralized Finance (DeFis), Web3, and Infrastructure and Scaling.

Yassine Elmandjra, the crypto asset analyst at ARK, noted that ARK is pleased to offer investors these strategies at a time when “speculative behavior [in the crypto market] has calmed down.”

Ark Invest’s Previous Moves In The Crypto-Verse

Currently, Ark Invest manages eight ETFs in the United States. However, its dream Bitcoin ETF has been rejected by the SEC over concerns of not being able to protect investors from market speculations. As of today, The United States has not approved a crypto ETF focused on the spot market.

The ARK Innovation ETF (ARKK) is quite popular among crypto enthusiasts for its heavy exposure to crypto. Cathie Wood’s company has invested in some crypto stocks like Twitter, Coinbase, and Tesla along with over 8 million shares in Grayscale Bitcoin Trust (GBTC).

The firm is bullish long-time bullish on crypto —perhaps way too much.  Back in April of 2022, Cathie Wood said Bitcoin could reach $1 million per coin in 2030. To achieve such a high price, investors must truly see the value of Bitcoin and reallocate a major part of their assets:

“We don’t need much. All we need is that 2.5% of all assets is allocated in Bitcoin,”

Seems like Wood is doing her part to make that dream come true.