Cathie Wood buys $13.8 million of tumbling tech stock

One of Cathie Wood’s signature moves is buying stocks erstwhile they propulsion back, looking for names she believes volition retrieve implicit time.

The CEO of Ark Investment Management followed that playbook again successful the past week, picking up a tech banal that dropped 16.3% implicit the past 5 trading days.

Wood’s concern strategy has worked good this year, with her funds outpacing the large marketplace indexes. As of Nov. 7, the flagship Ark Innovation ETF (ARKK) is up astir 40% year-to-date, acold outpacing the S&P 500’s summation of 14.2%.

Wood gained a beardown estimation aft the Ark Innovation ETF delivered a 153% instrumentality successful 2020. The aforesaid benignant that produces large wins successful a rising marketplace tin besides bring dense losses, arsenic it did successful 2022, erstwhile the money fell much than 60%.

Those swings person weighed connected her semipermanent results. As of Nov. 6, the Ark Innovation ETF has delivered a five-year annualized instrumentality of -4.07%, portion the S&P 500 has an annualized instrumentality of 15.57% implicit the aforesaid period, according to information from Morningstar.

Wood’s concern strategy is straightforward: Her Ark ETFs typically people emerging high-tech companies successful fields specified arsenic artificial intelligence, blockchain, biomedical technology, and robotics.

She believes these companies person the imaginable to reshape industries and present outsized semipermanent returns, but their volatility leads to large fluctuations successful the values of Ark funds.

Related: Cathie Wood's nett worth: The Ark Invest CEO's wealthiness & income

Over the 10 years ending successful 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.

Still, Wood has been bullish connected the market. In a missive to investors published successful precocious April, she dismissed predictions of a recession dragging into 2026 and struck an optimistic code for tech stocks.

"We deliberation consumers and businesses are apt to accelerate the displacement to technologically enabled innovation platforms, including artificial intelligence, robotics, vigor storage, blockchain technology, and multiomics sequencing," she said.

Not each investors stock this optimism. In the 12 months done Nov. 6, the Ark Innovation ETF saw astir $1.38 cardinal successful nett outflows, according to ETF probe steadfast VettaFi.

On Nov. 5, Wood’s Ark funds purchased 521,867 shares of Pinterest (PINS), valued astatine astir $13.8 million, pursuing the societal platform's banal plunge aft disappointing net and outlook.