Investors fled Cathie Wood's flagship fund in the 3rd quarter faster than any other on record

• Investors poured out of Cathie Wood's flagship innovation ETF at the fastest quarterly pace on record, according to a new Bloomberg report.
• The ARK Innovation ETF, also called ARKK, saw $1.97 billion in outflows in the third quarter, marking the steepest-ever move out of the fund since its 2014 launch.
• The turbulent quarter for ARKK adds to a tough year for the popular tech-focused ETF.

Investors poured out of Cathie Wood's flagship innovation ETF at the fastest quarterly pace on record, according to a new Bloomberg report.

The ARK Innovation ETF, also called ARKK, saw $1.97 billion in outflows in the third quarter, marking the steepest-ever move out of the fund since its 2014 launch. Investors began to balk at ARKK in July, a trend that gained momentum throughout August and September.

Data for the last trading day of the quarter was not yet available, so that outflow number could still move around a bit, according to Bloomberg.

The turbulent quarter for ARKK adds to a tough year for the popular tech-focused ETF. After exploding nearly 150% in 2020, the fund is down more than 11% so far in 2021 and is being hit by regular outflows.

Worse, short bets against ARKK are mounting. In August, "Big Short" investor Michael Burry unveiled that he bought $31 million worth of put options that would profit from ARKK falling. Burry's bet came just weeks after data showing that short interest in ARKK had hit an all-time high of $2.7 billion.

ARKK's weak third quarter came during a mixed month for stock markets as concerns about supply chains, inflation, and overly optimistic valuations piled up. The broader S&P rose only 2.5% during the quarter, dragged down by a gloomier September that saw a nearly 5% drop.