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What is an index or reference period return?​

The term "index period return" refers to the return of the reference asset or benchmark index over the same outcome period. In the case of the ARK Defined Innovation Exposure Term ETFs the reference asset is ARKK – the ARK Innovation ETF.

For ARK DIET, the reference period return would be ARKK’s performance over the 12-month outcome window. 

This return is used to calculate an investor’s defined outcome. For example: 

  • If ARKK returns 10%, and the buffered ETF has a 5% hurdle and 80% participation rate, the ARK DIET ETF may return about (10% – 5%) × 80% = 4%. 

The index return is the starting point for determining how the reference ETF performs during the defined timeframe.