Wall Street‘s riskiest trades are suddenly back on top: Chart of the Day
Jared Blikre
Fri, August 14, 2026 at 8:45 PM GMT+5:30
2 min read
Investors are reaching for more risk — and getting paid for it
Nine trading days into August, Cathie Wood’s ARK Innovation ETF (ARKK) is up 16%, while IPOs, chips, and software have all jumped 9% or more as of Thursday’s close
The risk trade is cooling Friday, but not reversing. ARKK is having its worst day in two weeks while chips and software trade lower
The gains this month are enormous in dollar terms too. Nvidia (NVDA) has added about $600 billion in market value this month, while SpaceX (SPCX) has piled on roughly $440 billion
Microsoft (MSFT) has added nearly $240 billion, while Micron (MU), Broadcom (AVGO), and Palantir (PLTR) have each gained more than $130 billion
What stands out is how many different flavors of risk are working at the same time
An equal-weight basket of ARKK, the Renaissance IPO ETF (IPO), the iShares Semiconductor ETF (SOXX), and the iShares Expanded Tech-Software Sector ETF (IGV) is beating the SPDR S&P 500 ETF (SPY) by about 8 percentage points through August’s first nine trading days
That is the basket’s biggest early-month lead since 2015, the first full year after ARKK launched and all four funds were trading
The IPO surge is especially notable after years in which going public increasingly became an exit ramp for mature private companies, rather than the beginning of the growth story
And this rally has plenty of company beneath the surface
Seven in 10 stocks in both the S&P 500 and Nasdaq-100 are higher this month, and the participation gets even stronger in chips and software
That is a sharp change from July, when a $3.2 trillion rotation between chips and the Magnificent Seven left investors choosing sides. In August, they are buying a lot more of the menu
The top chart highlights the two closest historical matches to August’s early risk surge. They ended very differently. In May 2025, the rally kept running — ARKK gained another 36% over the next three months, while SPY rose about 10%
January 2021 was the fake-out. The S&P 500 kept climbing, but the speculative leaders did not
ARKK got cut in half over the next year
August may be another broad risk-on surge. History says that does not guarantee today’s hottest trades will still be leading when the dust settles
Jared Blikre is the global markets and data editor for Yahoo Finance. Follow him on X at@SPYJaredor email him at jaredblikre@yahooinc.com
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