Cathie Wood’s Ark Investment Management launched its first new exchange-traded fund in two years on Tuesday, a key test of the money manager’s appeal after a choppy few months of both flows and performance.

The actively managed ARK Space Exploration ETF (ticker ARKX) tracks U.S. and global companies engaged in space exploration and innovation. More than US$196 million worth of shares changed hands as of noon in New York, a strong start for the new product.

When Ark filed for the fund in January it triggered an industry-wide rally -- such was the hype surrounding Wood, whose ETFs were among the best-performing of 2020. Since then Ark’s bets have been rattled amid a broader tech selloff. The flagship Ark Innovation ETF (ARKK) has posted investor exits for five days running, according to the latest data, the longest stretch of consecutive outflows since the fund started in 2014.

Nevertheless, Ark ETFs overall have attracted almost US$16 billion of new cash this year, signaling demand for a new offering could be robust. Despite recent turbulence, all five of Wood’s existing actively-managed products are up more than 130 per cent in the past 12 months.

“That performance naturally attracts more investments, especially on the part of retail traders,” said Matthew Weller, global head of market research at Forex.com. “The optimism evoked by Cathie Wood and her team is almost infectious -- that’s something that has legs.”

The initial spike of trading in ARKX drew comparisons to the launch of the VanEck Vectors Social Sentiment ETF (BUZZ) earlier this month. That fund saw about US$260 million worth of shares change hands in the first hour of trading, compared with US$114 million for ARKX, according to Eric Balchunas, ETF analyst for Bloomberg Intelligence. But the space fund has far surpassed the first-day action in Wood’s last fund launch in 2019, when the ARK Fintech Innovation ETF (ARKF) saw US$1.2 million worth of shares traded.

At the outset, the space fund’s top two holdings are Trimble Inc. and another Ark fund called the 3D Printing ETF (PRNT) with weights of 8.6 per cent and 6 per cent, respectively. Other large stakes include Kratos Defense & Security Solutions Inc., L3Harris Technologies Inc. and JD.com Inc. The fund aims to invest at least 80 per cent of its assets in the space industry.

Possible competitors include the Procure Space ETF (UFO), which was among those that rallied when Ark filed for the new fund. Assets in UFO have roughly tripled since then to US$129 million.