LEL recorded year, ARK ETF, observation post COVID and China

We achieved another recorded year for our clients and successfully guide investors to get through the uncertainty of pandemic.

Our Q4 return was 21%, and 2020 FY return was 145%, with sortino ratio 2.6x.

Our cash position was strong and stable post pandemic, maintaining roughly 30% excess liquidity and very low theta and delta exposure daily to the market.

Ark is an example of building a wealth management business through solid return

Ark ETF grew AUM from 1.6bn at end of 2019 to 8.9bn by end of 2020, while Vanguard lost half trillion in AUM as of end of Q3 2020 despite Ark charges multiple time higher fees than Vanguard. Ark proposed the idea of investing in innovation companies rather than by market cap, geography or other traditional mutual fund focus. This strategy appeals to investors because a great innovating companies could generate more and longer consistent return. Therefore, Ark is growing market share with little effort on marketing campaign.

Ark ETF can't protect investor from down time. It is still considered an active management financial instruments.

Due to its natural of ETF, Ark can't short stock or do more hedging. It is likely to face withdraw pressure during bad market years. Thus, investors still need to balance their portfolio through other measures, which increases complexity and time effort.

Post COVID era, people saves significantly in transportation costs.

US consumer spent 13% income on transportation costs. For most office worker, work from home practice saves them daily commute work and time. Overall, economy efficiency improves due to the further penetration of e-commerce. 2020 stock market boom is not just a pure monetary policy impact. In long term, society should benefit and grow after COVID.

China retail sales outgrow US in Oct 2020 for the first time

China retail sales reach 3,857 billion RMB( 584.4 bn USD) higher than that of US at 552.5 billion USD. China's manufacturing strength will further accelerate this trend since their domestic consumer should enjoy the benefit from economy of scale.

E-commerce penetration China vs U.S. and more growth to come

China's E-commerce penetration reaches 25% in Nov 2020 compared to roughly 15% in US. The higher population density should form a competitive advantage for China's companies in costs structure. Obviously, further increase in e-commerce penetration could fuel the post pandemic growth story.