Cathie Wood buys $1.9 million of megacap tech stock

Cathie Wood, CEO of Ark Investment Management, typically focuses connected small- and mid-cap exertion stocks, but she occasionally ventures into megacap maturation stocks. This attack tin assistance adhd stableness to her funds, portion her introduction timing often reflects marketplace opportunities.

That’s what she conscionable did, adding shares of 1 of the market’s largest exertion leaders earlier its February earnings.

Wood gained a estimation aft the Ark Innovation ETF delivered a 153% instrumentality successful 2020. Last year, the flagship Ark Innovation ETF (ARKK) gained 35.49%, acold outpacing the S&P 500’s instrumentality of 17.88% successful the aforesaid period.

Wood’s benignant brings saccharine wins successful rising markets but besides achy losses successful bearish ones, arsenic seen successful 2022, erstwhile the Ark Innovation ETF tumbled much than 60%.

Those swings person weighed connected Wood’s semipermanent results. As of Jan. 30, the Ark Innovation ETF has delivered a five-year annualized instrumentality of -11.29%, portion the S&P 500 has an annualized instrumentality of 14.99% implicit the aforesaid period, according to information from Morningstar.

Wood focuses connected emerging high-tech companies crossed artificial intelligence, blockchain, biomedical technology, and robotics. She thinks these businesses person large imaginable for large alteration and semipermanent growth, though their volatility often causes fluctuations successful the Ark’s funds.

From 2014 to 2024, the Ark Innovation ETF wiped retired $7 cardinal successful capitalist wealth, according to an investigation by Morningstar’s expert Amy Arnott. That made it the third-biggest wealthiness destroyer among communal funds and ETFs successful Arnott’s ranking.

Related: Cathie Wood buys $10.7 cardinal of sinking AI stock

In a missive published connected Jan. 15, Wood says the U.S. system is storing up vigor for a crisp rebound successful 2026.

"Despite sustained existent gross home merchandise maturation during the past 3 years, the underlying U.S. system has suffered a rolling recession and has evolved into a coiled outpouring that could bounce backmost powerfully during the adjacent fewer years," Wood wrote.

Wood besides rejects the “AI bubble” talk, saying it "is years away" and "the astir almighty superior spending rhythm successful history" is coming.

"What erstwhile was the headdress successful spending seems to person go a level present that the AI, robotics, vigor storage, blockchain technology, and multiomics sequencing platforms are acceptable for premier time," she said.

Not each investors hold with Wood’s optimism. In the 12 months done Jan. 28, the Ark Innovation ETF saw astir $1.11 cardinal successful nett outflows, according to ETF probe steadfast VettaFi.

The Ark Innovation ETF is down 3.85% year-to-date arsenic of Jan. 30. The S&P 500 scale rallied 1.37 implicit the aforesaid period.