Skillz Spikes 21% After Cathie Wood Adds The Former SPAC To ETF

Skillz Spikes 21% After Cathie Wood Adds The Former SPAC To ETF

One of the most popular ETF managers added a stake in a former SPAC, causing the share price to jump after-hours Monday and during Tuesday’s trading session.

What Happened: The Ark Next Generation Internet ETF ARKW purchased 215,897 shares of Skillz Inc SKLZ.

The stake in Skillz is the smallest in the ETF, representing around $3.9 million and less than 0.07% of the fund’s assets.

Why It’s Important: The Ark Next Generation Internet ETF was up over 140% in 2020. While the initial position is small, Wood has a tendency to accumulate positions in small increments.

This is the third SPAC added to the ARK funds recently as Opendoor Technologies Inc OPEN and Longview Acquisition Corp LGVW are also now in Ark ETFs.

Prior to the SPAC merger, shares of Skillz were added to both the Roundhill Esports & Digital Gaming ETF NERD and Roundhill Sports Betting & iGaming ETF BETZ.

“Skillz has patented technology to help game developers match users in a new betting platform similar to daily fantasy sports,” Roundhill CEO Will Hershey told Benzinga.

Skillz is creating a second layer of monetization for game creators Hershey added. Hershey said Skillz could be an acquisition target down the road thanks to a patent they own.

Benzinga’s Take: Wood has been one of the biggest names for investors to follow with trades. The active fund manager has seen strong interest thanks to her triple-digit gains across several ETFs in 2020.

Many new positions added to Ark Funds see strong spikes in the after-hours market. Despite the spike, investors could benefit from following Wood’s SPAC picks.

Wood started added shares of Opendoor when it was IPOB back on Oct. 2, 2020. Shares were $18.25 the next day and are trading over $29 now. Wood started adding shares of Longview on Nov. 23. Shares spiked into the $16 level the day after the add from $13.60. Shares of Longview trade above the spike price at $18.71.

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© 2021 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

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