As DocuSign suffers its worst stock decline on record, these ETFs have the biggest exposures – MarketWatch

A precipitous decline in shares of DocuSign was rewriting the record books for the electronic-signature company, pushing it toward its worst daily drop on record.

But the drop for the company also was denting the performance of a handful of exchange-traded funds where DocuSign has its largest exposure.

The Ecofin Digital Payments Infrastructure Fund TPAY, -4.56%, where DocuSign was a top 10 holding, was down 4.1%; the American Century Focused Dynamic Growth ETF FDG, -5.05%, where the company is a top 5 holding, was off 4.7%. Meanwhile, the iShares Cybersecurity & Tech ETF IHAK, -4.74%, trading 4.7% lower, and the ProShares Nasdaq-100 Dorsey Wright Momentum ETF QQQA, -3.88%, off 4%, all had exposure to DocuSign.

DocuSign’s tumble comes after its latest earnings report, in which it delivered a disappointing billings outlook as Chief Executive Dan Springer called out a “return to more normalized buying patterns” following a stretch of “accelerated growth.”

The company had been viewed as a hot pandemic stock play but now was being viewed as a sign of a company that might have grown too quickly as investors crowded into trades that worked.

Friday’s downturn was also a part of a broader selloff in the tech and tech-related sector, with the tech-laden Nasdaq Composite Index COMP, -2.60% down more than 6% from its Nov. 19 peak and the S&P 500 index SPX, -1.44% and the Dow Jones Industrial Average DJIA, -0.68% facing a volatile period of trade, marked by fears about the spread of novel variant of the coronavirus that causes COVID-19, designated as omicron the World Health Organization last Friday, and comments from the Federal Reserve that point to tighter financial conditions, problematic for tech stocks that tend to be sensitive to moves in borrowing costs.