Cathie Wood’s flagship fund may be down, but it certainly isn’t.
The $ 21 billion
ETF ARK Innovation
(ARKK) has rebounded 13% in the past two weeks, after falling nearly 37% from February to mid-May. The S&P 500 gained 2% over the same period.
ARK Innovation, which focuses on companies with disruptive technologies, is not the only ARK fund to catch its breath after three months of free fall. The company’s six actively managed ETFs, which tend to be highly correlated, have gained an average of 10.3% since May 13, with ARK Innovation leading the rankings and ARK Space Exploration & Innovation ETF (ARKX) trailing behind with gains of 5.4%. . Yet all of these funds are far from reaching their peak in mid-February.
Wood remained firm throughout the dive, repeatedly insisting in interviews that innovation stocks were on sale. She kept her word and went on a shopping spree. Over the past three months, ARK Innovation has bought a lot of declining stocks – and not just top stocks like (TSLA) and Teladoc (TDOC). The popular high profile fund manager bought shares in companies that had just taken off.
ARK Innovation has bought over 3 million shares of the new publicly traded cryptocurrency exchange
(COIN), with a current value of approximately $ 765 million. And the fund has a new position in the sports betting company
(DKNG), by purchasing 8 million shares with a current value of $ 397 million. On Wednesday, the two stocks respectively represented 3.6% and 1.9% of the portfolio.
Other newly added names include video game platform Skillz (SKLZ) and software company UiPath (PATH), which now each have more than 1% weight in the fund.
Another notable name is the software company
(PLTR). Wood quadrupled ARK Innovation’s holdings from 5 million to 22 million shares. The stock now represents 2.4% of the fund’s portfolio.
DraftKings and Palantir are both up 23% since May 13, although they are still down from their February levels. Skillz and UiPath jumped 26% over the same period. Following strong Bitcoin sales, Coinbase stock continued to decline for a few more days than other innovation stocks, but has also started to recover since last week.
ARK Innovation has also more than doubled its stakes in two biotechnology companies,
(FATE), as well as the names of slaughtered technologies
Focus on video communications
(ZM). All have jumped higher in the past two weeks, with gains ranging from 7% to 21%.
On the other hand, ARK Innovation has sold all of its shares in fintechs
(PYPL) and LendingTree (TREE), Chinese technology company Baidu (BIDU), truck manufacturer
Semiconductor manufacturing in Taiwan
(TSM). Just three months ago, Baidu and PayPal were the fund’s fifth and eleventh largest holdings.
So far, Cathie Wood’s bargain hunt for innovation stocks seems to be paying off. If the group’s decline is really short-term and the rebound continues, maybe ARK Innovation investors will soon be able to smile.
Write to Evie Liu at [email protected]