ARK Autonomous Technology & Robotics ETF

ARKQ

Market cap $2.06B

As time goes on, I've started to focus more on building ETF positions and less on individual stocks. I'm planning to buy shares of two ETFs to capitalize on mispriced small-cap stocks and interest rate tailwinds.

Ark Invest had a 2025 to remember, with ETFs from the Cathie Wood-led financial company outpacing the S&P 500's full-year gains. Here's a look at the gains for the six main Ark Invest ETFs and how they compare to the S&P 500, along with a look at top holdings in the top-performing funds.

Thematic investors are split between two big future bets: robotics and electric vehicles.

The Vanguard Russell 2000 ETF looks extremely attractive as we head into 2026. Real estate could be a big winner as interest rates fall, and the Vanguard Real Estate ETF is on my buy list.

The ARK Autonomous Technology & Robotics ETF (ARKQ) offers tactical trading potential amid renewed AI/robotics enthusiasm, but long-term risk remains elevated at current valuations. ARKQ's concentrated portfolio — top 8 holdings comprise half the fund — mirrors broader market risk-on/risk-off dynamics, with high volatility and limited long-term outperformance versus QQQ. Valuations are stretched, with ARKQ trading at 52x trailing earnings and 14x sales, making it more suitable for short-term trades than core long-term allocations.

ARKQ trades at an average 89.78x P/E (equal-weighted), far above the NASDAQ, making it extremely expensive. Holdings grow EPS by 17.6% annually, below top tech leaders, yet the ETF's P/E is roughly twice as high. Only 84% of holdings are profitable, with cash-burning companies excluded from my P/E calculation.

The incredible success of some of the top holdings in the ARK Autonomous Technology & Robotics ETF has propelled it to strong gains this year. The ETF is on track to generate returns of at least 30% for a third straight year.

Robotics ETFs can be a great way for investors to get exposure to this exciting technology trend. The GlobalX Robotics and Artificial Intelligence ETF tracks an index of more than 50 robotics stocks.

Investing in individual artificial intelligence stocks isn't the best move for everyone. The Invesco QQQ ETF has surprising amount of AI exposure for a minimal ongoing cost.

The Ark Autonomous Technology & Robotics ETF is handily outpacing the "Magnificent Seven" stocks in 2025. The Cathie Wood ETF owns 36 stocks, and some of its largest positions are smaller, up-and-coming companies.