Cathie Wood Goes AI Bargain Hunting: She Just Bought a Stock That Crashed 17% in 1 Trading Session and a Stock That's Dropped 50% From Its Peak.

When a fashionable banal drops, immoderate investors fly -- but Cathie Wood does conscionable the opposite. The laminitis and main enforcement serviceman of Ark Invest alternatively takes a person look astatine the down but astir apt not retired player, and successful galore cases, she volition prime up shares astatine a bargain price. This is each portion of the celebrated investor's strategy. She aims to get successful connected innovative companies astatine tenable oregon inexpensive prices and clasp connected for the agelong word to payment from their growth.

This method has helped Wood's flagship Ark Innovation money beforehand much than 50% implicit the past 3 years. And considering that the money includes galore of tomorrow's imaginable winners, this could beryllium conscionable the opening of Ark Innovation's semipermanent maturation story.

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In caller days, artificial quality (AI) stocks person faltered, and that hasn't escaped Wood's eye. It was the cleanable accidental for this savvy capitalist to spell bargain hunting, and arsenic she did, she bought a banal that precocious crashed 17% successful 1 trading league and a banal that's dropped 50% from its peak. Let's zoom successful for a person look.

Cathie Wood bought shares of Advanced Micro Devices (NASDAQ: AMD) arsenic it tumbled 17% connected Feb. 4. This was successful the trading league aft the institution announced net that bushed analysts' estimates -- but investors were disappointed that, considering request for AI chips, the company's forecast for the archetypal 4th wasn't adjacent higher. AMD expects $9.8 cardinal successful gross for that quarter.

Wood loaded up connected AMD shares, adding them to 5 of her funds: Ark Innovation, Ark Autonomous Technology, Ark Next Generation Internet, Ark Blockchain and Fintech, and Ark Space & Defense. AMD is the sixth-biggest holding successful Ark Innovation, representing astir 3.9% of the fund.

AMD is simply a rival of AI spot person Nvidia, arsenic it makes graphics processing units (GPUs) that powerfulness the astir important of AI tasks. These chips are indispensable successful the aboriginal stages of AI, arsenic they substance the grooming of models, but they are besides an integral portion of the functioning of AI arsenic it does its occupation of problem-solving. This makes them a changeless portion of the AI maturation story.

Though AMD's forecast wasn't arsenic beardown arsenic immoderate analysts expected, it's important to look astatine the semipermanent accidental -- it remains significant. The AI marketplace is forecast to scope into the trillions of dollars, and this spot elephantine is precise apt to payment from that.