Everybody, back on the ARK.
Cathie Wood’s ARK Invest emerged as the top-performing ETF issuer in the US in 2025, a notable turnaround after several years of mixed results. Four ARK exchange-traded funds ranked among the top five equity funds last year, according to Morningstar Direct data. Three of those funds claimed the gold, silver and bronze spots, benefitting from exposure to companies that focus on artificial intelligence, defense and next-generation computing. It’s a notable reversal after a 2024 Morningstar report found ARK funds destroyed an estimated $14.3 billion in wealth over the past decade, and a friendly reminder to advisors that market timing is literally everything.
“In 2025, investors wanted heat, not safety,” said Robby Greengold, a principal of equity strategies at Morningstar, adding that other funds like the Invesco S&P 500 High Beta ETF climbed more than 30%. “It was a year when risk didn’t just pay, it paid handsomely.”
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The reason behind ARK’s success was a risk-on environment, with the company hitting a “sweet spot” as investors chased returns, Greengold added. But that impressive performance didn’t turn into sales. The firm’s flagship fund, ARKK, landed in fifth place on the best-performing list with a 35.6% gain last year, but shed more than $1.2 billion in assets. Similarly, ARKW, a fund focused on the next generation of the internet, gained 39% but saw $240 million walk out the door, according to Greengold. “While the funds soared, investors sold,” he said.
Still, the top 3 performing funds of last year all had ARK Invest on the label:
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ARK Autonomous Technology & Robotics ETF took the top spot, returning 49% and ending the year with $1.8 billion in AUM.
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The $534.9 million ARK Space & Defense Innovation ETF returned 48%.
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In third place was the $2.1 billion ARK Next Generation Internet ETF mentioned above.
Ups and Downs: ARK’s success hasn’t come without its share of controversy. While the company’s investment approach gained attention during the pandemic for its astronomic performance and daily transparency, its concentrated portfolios drew heavy criticism from analysts. “[Our] manager research team doesn’t expect ARK’s ETFs to outperform over the long haul,” Greengold said.
In the near term, though, something tells us that investors are already getting back on board.
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