Cathie Wood buys $56 million of megacap tech stock

Cathie Wood, caput of Ark Investment Management, is champion known for betting connected early-stage tech names and high-growth innovators. But occasionally she makes a determination into the megacap abstraction erstwhile she sees value.

That’s what Wood did successful the past week (Thanksgiving Week), adding astir $56 cardinal worthy of a megacap tech name, 1 of her largest caller purchases.

Wood gained a estimation aft the Ark Innovation ETF delivered a 153% instrumentality successful 2020. Year-to-date, Wood’s flagship Ark Innovation ETF (ARKK) is up astir 38% arsenic of Nov. 28, outpacing the S&P 500’s summation of 16.45% 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 money mislaid much than 60%.

Those swings person weighed connected her semipermanent results. As of Nov. 26, the Ark Innovation ETF has delivered a five-year annualized instrumentality of -6.18%, portion the S&P 500 has an annualized instrumentality of 15.28% 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.

In Wood’s view, these companies could reshape the satellite and thrust beardown semipermanent growth, yet 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

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.

In October, Wood said successful a CNBC interrogation that she expects to spot a marketplace “shudder” arsenic involvement rates statesman to rise.

Still, Wood believes successful the imaginable of AI, denying the “AI bubbles” speech amid concerns astir the precocious valuations of tech stocks.

“I bash not judge AI is successful a bubble,” Wood said. “ What I bash deliberation is, connected the endeavor side, it is going to instrumentality a portion for ample corporations to hole themselves to transform…in bid to truly capitalize connected the productivity gains that we deliberation are going to beryllium unleashed by AI.”

Not each investors hold with Wood. In the 12 months done Nov. 27, the Ark Innovation ETF saw astir $1.3 cardinal successful nett outflows, according to ETF probe steadfast VettaFi.

On Nov. 25, Wood’s Ark funds bought 174,293 Alphabet (GOOG) Class C stock, valued astatine astir $55.77 million. On the time of purchase, Alphabet banal roseate to a grounds precocious of $328.67 successful intraday trading amid reports saying it could merchantability AI chips to Meta Platforms (META).