Exchange-traded funds (ETFs) can make investing a whole lot easier for investors. They can help you invest in the entire stock market, a certain industry, or a specific theme like robotics or renewable energy. They can even make it easy to short, or bet against, companies and industries.
One such ETF that has been doing incredibly well this year is the Tuttle Capital Short Innovation ETF (NASDAQ:SARK). It bets against the ARK Innovation ETF (NYSE Arca:ARKK), which is down 28%; the Short Innovation ETF is up over 29%. It has done a fine job of accomplishing its goal of achieving the inverse of ARK Innovation's single-day returns. Its premise is based on the idea that the stocks in that fund are overvalued and are likely to fall. And thus far, that's exactly what has happened. Even the mighty Tesla (NASDAQ:TSLA), which for a long time looked like it could do no wrong, has fallen 23% in 2022 as investors have been shifting away from growth stocks in the first few months of the new year.
With several interest rate hikes likely in the cards this year and inflation also putting pressure on consumers, it could be a challenging year for many businesses, especially ones like Tesla that sell high-priced vehicles.
Depending on your outlook for growth stocks, you can take either a bullish position and invest in the ARK Innovation ETF, or bet against it using the Short Innovation ETF. Either way, both ETFs make it easier than ever to bet on growth stocks.
