Cathie Wood buys $15.7 million of tumbling tech stock
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Cathie Wood, chief of Ark Investment Management, often takes advantage of stock price drops after earnings reports by adding more shares to her portfolio.
That's exactly what she did this week. Wood sees earnings season as a chance to adjust her positions.
Investors and analysts have mixed views on Cathie Wood. Supporters praise her as a visionary in tech investing, while critics dismiss her as a mediocre fund manager.
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Known among followers as “Mama Cathie,” Wood drew significant attention with a stellar 153% return in 2020, bolstered by her clear, accessible discussions of her strategy across media platforms.
However, her long-term performance paints a more complex picture.
Related: Cathie Wood buys $25.9 million of major tech stock
ARK Invest's flagship fund, the ARK Innovation ETF (ARKK) , managing $5.8 billion in assets, has returned -10.9% year-to-date. Its annualized return is -27.8% over three years and a modest 1.3% over five years.
In contrast, the S&P 500 has climbed 21% this year, and its annualized return is 9.2% over three years and 15.3% over five years.
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Cathie Wood’s investment strategy explained
Cathie Wood’s investment philosophy centers on breakthrough technologies, with a focus on sectors such as artificial intelligence, genomics, and blockchain. She prioritizes long-term growth, even as it comes with the ups and downs of the tech market.
Wood believes these disruptive fields hold the promise of strong future returns. But ARK’s focus on high-growth stocks means fund values can be highly volatile.
Fraser Perring, a short-seller and founder of Viceroy Research, delivered a harsh critique of Wood in 2022.
Related: Cathie Wood's net worth: The Ark Invest CEO's wealth & income
"I wouldn’t even put your money with Cathie Wood,” he remarked to New York magazine. “She is part of the problem… She’s a capital depleter. With the amount of capital she’s evaporated, how can people even suggest she’s successful? She’s successful at failing.”
Morningstar portfolio strategist Amy Arnott calculated that Ark Innovation destroyed $7.1 billion of shareholder wealth from its 2014 inception through 2023. That put the ETF as No. 3 on her wealth destruction list for mutual funds and ETFs for the past decade.
In a July 2024 post on ARK’s website, Wood defended her position, admitting that “the macro environment and some stock picks have challenged our recent performance.”
However, she maintained that her “commitment to investing in disruptive innovation has not wavered.” According to Wood, many of ARK’s holdings are now in “rare, deep value territory.”