Cathie Wood, CEO of ARK Invest.
Patrick T. Fallon/AFP/Getty Images
Cathie Wood is taking advantage of the latest plunge in stocks. On Tuesday, a dreadful day for the Nasdaq Composite, Wood’s ARK Innovation exchange-traded fund snapped up shares of Tesla , Roku , Zoom Video Communications , and others.
On a day when the Nasdaq fell 2.3% and the ARK Innovation ETF (ticker: ARKK) dropped 7%, Wood turned over about 0.7% of her fund. It was good timing.
She doubled down on many of her largest positions, adding about $58 million worth of Zoom (ZM), Tesla (TSLA), Roku (ROKU), Block (SQ), Coinbase (COIN), and Twilio (TWLO). Those are six of the top 10 holdings in the ARK Innovation fund.
It was good timing. Tesla stock has gained 5.4% on Wednesday, while Zoom has climbed 8.9%, Roku has jumped 6.8%, Block has advanced 2.4%, Coinbase has popped 9.3%, and Twilio is up 4.9%.
The purchases were funded by selling about $50 million worth of Spotify Technology (SPOT). That is the 12th largest holding in the fund.
The largest purchases were roughly $18 million of Roku stock and $14 million acquisitions of Tesla and Block.
After the changes, Zoom Video Communications is the largest holding in the fund, representing about 9.1% of the ETF’s $8.8 billion. Tesla is in the No. 2 slot at 8.3%, while Roku is third at 7.8%.
It was this past week that Tesla lost the top spot to Roku. That change was due to the movement of the market: When Roku took over the top spot, its shares were down about 17% over the prior month, while Tesla shares had declined about 31%.
ARK Innovation has had a difficult year. It tends to be almost twice as volatile as the Nasdaq, rising more in good times and falling faster when things get ugly.
Coming into Wednesday trading, ARK Innovation was down about 59% this year. The top 10 holdings in the fund are off about 55% on average. The Nasdaq is down 28%, while the S&P 500 has lost 17%. The Dow Jones Industrial Average has fallen about 12%.
Wood isn’t changing her strategy and is adding to her best ideas despite the downdraft.
Write to Al Root at [email protected]
