St. Petersburg – September 24, 2026 -- ARK Investment Management LLC has launched the ARK Active Autocallable Income ETF (ARKY), targeting a 17.5% coupon by applying a volatility-harvesting strategy to its disruptive-innovation equity universe. The fund began trading on the Cboe BZX Exchange, marking ARK's first entry into the income-strategy category.
ARKY diversifies risk across 25 to 50 single-stock autocallable positions
Each holding in the portfolio references a single stock from ARK's high-conviction innovation universe and carries a 50% to 60% coupon barrier. A breach in one underlying asset affects only that position, while the remaining portfolio can continue generating income, according to the company.
Sub-advisor SCG Asset Management actively calibrates strike levels and payoff structures
SCG Asset Management, ARKY's sub-advisor, adjusts strike levels, maturities, and payoff structures on a position-by-position basis as market conditions shift, aiming to minimize net asset value erosion and maintain stable income generation over time.
Fund structures exposure through Synthetic Equity-Linked Notes rather than traditional issued notes
ARKY seeks its target yield through Synthetic ELNs -- instruments built using options or other derivatives designed to replicate the economic exposure of an equity-linked note tied to ARK's innovation equity universe. The structure delivers an autocallable payoff profile historically confined to bank-issued structured notes, but within a daily-liquid ETF wrapper offering 1099 tax reporting, no investment minimums, and no lock-up periods.
ARK positions the fund within a $180 billion-plus equity income market
Rahul Bhushan, ARK's Global Head of Investment Products, said active management is critical as investor interest in autocallable ETFs grows, with the fund targeting a 20% annual income rate by transforming the return profile of innovation stocks. Cathie Wood, ARK's Founder and CIO, said the fund is designed to convert the volatility created by disruptive innovation into a compelling income stream rather than treating it purely as risk.
The fund carries principal risks including derivatives risk, leverage risk, and liquidity risk tied to Synthetic ELNs, which have no liquid secondary trading market. ARKY may also reference Special Purpose Acquisition Companies, exposing the fund to SPAC-specific risk if a business combination is not completed or underperforms.