Cathie Wood’s Ark Invest gets behind a bitcoin futures ETF, stepping up its crypto involvement

Cathie Wood
Cathie Wood is the founder, CEO, and CIO of ARK Investment Management.

  • Cathie Wood’s Ark has put its name to a bitcoin futures ETF, an SEC filing Wednesday shows.
  • The ARK 21Shares Bitcoin Futures Strategy ETF was filed by issuer Alpha Architect and lists 21Shares as investment sub-adviser.
  • The filing assigns the ticker ARKA – a positive sign of coming SEC approval, according to an analyst.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

Cathie Wood’s Ark Invest just took a step further into crypto by putting its name to a bitcoin futures exchange-traded fund filed to the SEC Wednesday.

The ARK 21Shares Bitcoin Futures Strategy ETF will carry the ticker ARKA, according to the filing by ETF issuer Alpha Architect. Crypto firm 21Shares – part of Wood-backed Amun Holdings – is listed as a sub-adviser.

Ark Investment Management will provide marketing support, the filing said.

This is not the first time Cathie Wood has dived into the crypto ETF space. One of Ark’s funds gave itself clearance to buy Canadian bitcoin exchange-traded funds in late September. Bitcoin bull Wood has praised the cryptocurrency as a hedge against inflation.

The fact that the Ark-backed ETF has an assigned ticker is an indication the SEC could move soon on getting the green light for launch, according to Eric Balchunas, a senior ETF analyst at Bloomberg.

“ARK just filed for a bitcoin futures ETF via 21Shares and via whiteAlpha Architect white label (huge win for them). Already has ticker too: $ARKA (yet another good sign SEC gonna approve),” he posted to Twitter Wednesday.

With its involvement, Ark joins a queue of more than a dozen Wall Street players hoping to get approval for a crypto-focused ETF from US regulators. Four may get a green light before the end of the month, according to Bloomberg. These are ProShares Bitcoin Strategy ETF, Invesco Bitcoin Strategy ETF, VanEck Bitcoin Strategy ETF, and Valkyrie Bitcoin Strategy ETF.

Last week, the SEC approved Volt Equity’s exchange-traded fund, which is made up of stocks with bitcoin exposure such as mining companies. It’s seen as the closest to a bitcoin ETF to get clearance.

The prospect of a bitcoin ETF has spurred the bitcoin price back above $50,000, and pushed its market capitalization to return to top $1 trillion. Last week investors poured $225 million into assets backed by bitcoin, the most in seven months, because of the positive ETF outlook, according to CoinShares.

Read the original article on Business Insider

Cathie Wood says the exodus from expensive cities will keep a lid on inflation

Cathie Wood Ark Invest
Cathie Wood shot to fame in 2020 on the back of winning tech bets.

  • Cathie Wood has said the exodus from expensive cities during COVID should help hold down inflation.
  • Wood reckons strong inflation will be transitory, and has said she expects commodities to cool next year.
  • Her company, Ark Invest, is moving to St. Petersburg, Florida in November, from New York.

Superstar investor Cathie Wood has put forward one reason why strong inflation might not last: people are fleeing expensive cities like New York for cheaper ones.

Wood’s own company Ark Invest is relocating from New York to St. Petersburg, Florida in November.

She said on Tuesday at an Ark webinar that the cost of living in St. Petersburg “is anywhere from 20% to 40% less than in New York City and that includes the rents,” according to comments reported by CNBC.

“The exodus, or the great migration, is from the very high-rent areas of the world to much lower rents. So there’s going to be a mix effect that many are not taking into account as they’re thinking about inflation,” she said.

Read more: The head of investment strategy for iShares’ $2.3 trillion US business explains 2 key market themes that will define the upcoming Q3 earnings season – and shares why ‘stagflation’ concerns are overblown

During the coronavirus pandemic many people left densely populated cities. Working from home meant a company’s workers didn’t have to all be in the same place, while many people wanted more space and greenery.

Human resources company ADP found at the start of this year that 30% of remote workers in the US had changed their living arrangement during the pandemic, while another 29% were considering a change.

ADP said cities such as New York, San Francisco, Los Angeles and Miami were seeing “an exodus.”

Wood, who founded and is CEO of Ark Invest, is not worried about inflation, despite it coming in above 5% for the last three months in the US.

She has argued commodity prices should fall in 2022 and innovation should keep things cheap over the longer term.

Wood is moving Ark Invest to St. Petersburg because she sees it as an innovation hub, according to CNBC. “We believe that St. Pete wants to become the next Austin and attract tech companies, attract innovation,” she said.

Read the original article on Business Insider

Ark Invest’s Cathie Wood says China’s wide-ranging clampdown will lead to an economic downturn for the country

Cathie Wood, founder and CEO of ARK Investment Management LLC, speaks during the Skybridge Capital SALT New York 2021 conference in New York City, U.S., September 13, 2021.
Cathie Wood.

  • Ark Invest’s Cathie Wood said China’s wide-ranging clampdown will lead to an economic downturn.
  • “I really do think that the policymakers in China are beginning to play with fire,” Wood said, according to Reuters.
  • The star stock picker also doubled down on her bullishness toward Tesla stock.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

Ark Investment Management founder and CEO Cathie Wood on Tuesday said China’s wide-ranging clampdown from technology to gaming will lead to an economic downturn for the country, subsequently affecting the global economy.

“I really do think that the policymakers in China are beginning to play with fire,” she said during her webinar, according to Reuters. “We will look back at this period in six months and say ‘Wasn’t it obvious there will be a major and unexpected slowdown in China?'”

The famed stock picker said the Asian superpower’s attempt to rein in various sectors increases the chances of committing policy mistakes and putting a drag on growth, Reuters reported.

For instance, China announced in August that video game time for kids should be slashed to three hours each week, while reports said the government temporarily suspended approvals of new online video games.

In July, Wood notably dumped shares of Chinese internet stocks, including Tencent and JD.com. But a month later she began buying some of them back.

“I’m not pessimistic about China in the longer run because I think they’re a very entrepreneurial society,” Wood told Bloomberg in September. “Sure, the government is putting more rules and regulations in, but I don’t think the government wants to stop growth and progress at all.”

Also in the webinar Tuesday, Wood doubled down on her bullishness towards Tesla. The electric carmaker rose 2% to clear its key $800 resistance level on Tuesday after the company announced significant sales growth in China for September.

Wood shot to prominence in 2020 thanks to her blockbuster performance driven by bets into mega-growth stocks. Her ETFs last year have delivered eye-popping returns, with her nearly $20 billion Ark Innovation flagship fund up more than 150% in 2020.

Read the original article on Business Insider

Cathie Wood’s flagship fund cashed out of Coinbase shares worth $25 million as the stock rose after bitcoin topped $57,000

IMG_0125.JPG
Brian Armstrong, founder and CEO of Coinbase; Cathie Wood, founder and CEO of ARK Invest.

  • Cathie Wood’s Ark Invest sold more than 98,000 Coinbase shares on Monday, a trade notification showed.
  • Coinbase’s stock rose 3% on Monday after bitcoin hit a five-month high above $57,000.
  • The crypto exchange’s stock tracks bitcoin prices and trading volumes, some analysts say.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

Cathie Wood’s Ark Invest reduced its Coinbase holdings on Monday for the first time, selling as the stock rose in the wake of a rally in bitcoin to a five-month high.

The crypto exchange’s stock gained nearly 6% to reach $262.91 per share in intraday trading Monday, but closed 3.3% higher at $256.50 per share. Bitcoin topped $57,000 the same day, taking its year-to-date gains to 96%.

Wood’s Ark Innovation ETF sold 98,427 shares in Coinbase, worth more than $25 million at Monday’s closing price. The stock is still the flagship fund’s fourth-largest holding after Tesla, Teladoc Health, and Roku, according to company data.

Despite its recent gains, Coinbase’s stock is down 21% so far this year. It was changing hands at $254.76 per share, down 0.7% in early trading Tuesday.

The crypto company’s share movements track bitcoin prices and trading volumes, some analysts suggest. “As bitcoin prices go, so goes Coinbase’s stock,” said David Trainer, CEO of investment research firm New Constructs.

Wood’s key investing strategy typically involves a buy-the-dip approach. At various points this year, her funds have bought into short-term declines in bitcoin, Peloton, Zoom, and Ginkgo Bioworks after it was slammed by a short-seller. She has predicted that bitcoin will surge to $500,000 in five years.

Two other funds, Ark Next Generation Internet ETF and Ark Fintech Innovation ETF, also hold Coinbase stock. Together, all three combined have 6.3 million shares worth about $1.6 billion. The crypto exchange made its trading debut on the Nasdaq in April.

Separately on Monday, the Ark Innovation ETF increased its exposure to Teladoc, Crispr Therapeutics, and Intellia Therapeutics. It also sold about 16,000 in Warren Buffett-backed Chinese electric-vehicle company BYD.

Read More: A ‘bitcoin maximalist’ old school value investor breaks down why he thinks the cryptocurrency will hit $100,000 this year – and reveals the 2 altcoins he holds as speculative plays

Read the original article on Business Insider

Cathie Wood’s funds bought the dip in Gingko Bioworks after a short-seller called it a ‘Frankenstein’ of frauds

Cathie Wood
Cathie Wood.

  • Cathie Wood’s Ark Invest bought the dip in Ginkgo Bioworks after the stock tumbled as much as 24%.
  • Scorpion Capital slammed Ginkgo’s business model, alleging it was a “Frankenstein mash-up of frauds.”
  • Ark’s Innovation ETF and Genomic Revolution ETF now hold a combined $363 million of Ginkgo.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

Cathie Wood’s funds snapped up more than 8 million shares in Ginkgo Bioworks on Wednesday, as the stock plunged as much as 24% in the wake of a report that called it a “Frankenstein mash-up of the worst frauds.”

The flagship Ark Innovation ETF bought 6.7 million shares in the synthetic biology company, while the Genomic Revolution ETF picked up 1.5 million. Together, the ETFs now have a combined $363 million of Ginkgo, according to an Ark Invest trading notification, meaning the holding rose 11% in one day.

Wood took advantage of a slide in Ginkgo’s stock after Scorpion Capital released its short-seller report. The stock fell 11.6% to reach $10.59 per share at Wednesday’s close, having touched an intraday low of $9.27. It is down another 2.5% to $10.32 in premarket trading Thursday, and has lost 13% so far this year.

Scorpion Capital, which is short Ginkgo, bashed the company’s business model and practices. It said it based its findings on 21 research interviews with former employees, executives, and people currently employed at partner companies. Gingko went public last month via a $1.6 billion deal with a special purpose acquisition company.

“Ginkgo is a house of cards – in our opinion, one of the most brazen frauds of the last 20 years,” it said in the report published Wednesday.

It alleged that Gingko’s revenue is an “elaborate fiction” and that its current income is based on a “dubious shell game” based on customers the company itself fabricated and invested in. That meant Ginkgo sent its own money on a round-trip journey on its balance sheet, Scorpion Capital claims.

Gingko had not responded to Insider’s request for comment at time of writing.

Ark’s decision to dive further into Ginkgo may not be surprising, considering its prior investment activity. In August, its holdings in Zymergen, a synthetic biology rival to Ginkgo, saw the stock price tumble 80% in one day. But Ark tripled its stake in the company, instead of retreating.

The trading update from Ark Invest also showed Wood continues to dump its stake in Tesla. The Innovation ETF sold 63,135 shares in the electric-car maker on Wednesday, following a string of similar sales by the fund. But Tesla still represents its biggest holding.

Read More: These 20 stocks are set to grow earnings by at least 20% in 2022, Goldman Sachs says – even as broader market growth slows and taxes rise

Read the original article on Business Insider

Cathie Wood’s flagship fund has dumped almost all of its Nintendo stake ahead of a likely lackluster Switch console update

Cathie Wood Ark Invest
Cathie Wood.

  • Cathie Wood’s flagship fund has shed most of its Nintendo stake ahead of the new Switch console release.
  • The Ark Innovation ETF now holds about 1,500 ADRs worth $82,000 in the Japanese gaming powerhouse.
  • Analysts haven’t been bullish on Nintendo, saying rival consoles will likely outshine the Switch update.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

Cathie Wood’s flagship fund has been dumping Nintendo’s stock ahead of the Japanese video-game maker’s Switch console release slated for October 8.

The star stock-picker began to shed her stake in Nintendo in July, around the time the company tweeted it would introduce the OLED Switch update this month but had “no plans for launching any other model at this time.”

The Ark Innovation ETF now holds a tiny stake of 1,500 American Depositary Receipts in Nintendo worth about $82,000, according to data on Ark’s website.

That holding is a steep drop from the more than 4.7 million shares held by ARKK at the end of February, when Nintendo’s US-listed ADRs hit a price peak this year. The stock has dropped 32% year-to-date, and was last trading at $54.60 per share.

Nintendo stock

Nintendo’s new device, which comes with a $350 price tag, has a larger 7-inch OLED screen. But a hotly anticipated upgrade to its console’s graphics – 4K display capabilities that match rivals from Microsoft and Sony – is missing. This has disappointed some fans.

Also, analysts haven’t been too bullish on the stock, with Wedbush saying the next set of positive catalysts for Nintendo beyond the Switch may prove to be elusive.

“The Switch is likely entering its post-peak years as competition ramps up, and Nintendo has raised concerns about supply constraints,” Wedbush analysts Michael Pachter, Nick McKay, and Junaid Zubair said in a recent note.

“The scale of the Switch OLED model rollout remains unclear, and Nintendo has indicated that it does not have any plans for launching other Switch models beyond the OLED model at the moment,” they said, adding that this seemingly rules out a device with 4K resolution in the near future.

Wood, whose investing strategy focuses on “disruptive innovation,” has also been dumping Tesla stock. Three of Ark Investment Management’s ETFs offloaded $270 million worth of the electric-vehicle maker’s shares late last month. But all three still count Tesla among their top holdings.

Read More: 5 altcoins to buy in this bull run: A crypto investor says overlooking the 4th industrial revolution and blockchain could turn the millionaires of today into the middle class of tomorrow – and shares his entry and exit strategies for each altcoin

Read the original article on Business Insider

Investors fled Cathie Wood’s flagship fund in the 3rd quarter faster than any other on record

cathie wood
  • Investors poured out of Cathie Wood’s flagship innovation ETF at the fastest quarterly pace on record, according to a new Bloomberg report.
  • The ARK Innovation ETF, also called ARKK, saw $1.97 billion in outflows in the third quarter, marking the steepest-ever move out of the fund since its 2014 launch.
  • The turbulent quarter for ARKK adds to a tough year for the popular tech-focused ETF.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

Investors poured out of Cathie Wood’s flagship innovation ETF at the fastest quarterly pace on record, according to a new Bloomberg report.

The ARK Innovation ETF, also called ARKK, saw $1.97 billion in outflows in the third quarter, marking the steepest-ever move out of the fund since its 2014 launch. Investors began to balk at ARKK in July, a trend that gained momentum throughout August and September.

Data for the last trading day of the quarter was not yet available, so that outflow number could still move around a bit, according to Bloomberg.

The turbulent quarter for ARKK adds to a tough year for the popular tech-focused ETF. After exploding nearly 150% in 2020, the fund is down more than 11% so far in 2021 and is being hit by regular outflows.

Worse, short bets against ARKK are mounting. In August, “Big Short” investor Michael Burry unveiled that he bought $31 million worth of put options that would profit from ARKK falling. Burry’s bet came just weeks after data showing that short interest in ARKK had hit an all-time high of $2.7 billion.

ARKK’s weak third quarter came during a mixed month for stock markets as concerns about supply chains, inflation, and overly optimistic valuations piled up. The broader S&P rose only 2.5% during the quarter, dragged down by a gloomier September that saw a nearly 5% drop.

Read the original article on Business Insider

Cathie Wood dumps biggest chunk of Tesla stock in her recent string of sales

Cathie Wood is the CEO and chief investment officer of ARK Invest, which runs three of the highest-returning stock ETFs of the last three years. The Tesla logo is pictured at a Tesla showroom and service center on October 6, 2020 in Beijing, China.
  • Cathie Wood’s Ark Investment Management continued its selling spree of Tesla shares.
  • Three of her ETFs offloaded $270 million worth of Tesla stock Tuesday after the market close.
  • But all three, as of Sept. 29, still have the electric vehicle company as the top holding at more than 10% each.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

Cathie Wood’s Ark Investment Management continued its selling spree of Tesla stock after the investment management firm offloaded $270 million worth of the electric-vehicle maker’s shares Tuesday.

Three of Wood’s exchange-traded funds – ARK Innovation (ARKK), ARK Autonomous Technology & Robotics (ARKQ), and ARK Next Generation Internet (ARKW) – cumulatively sold more than 340,000 Tesla shares Tuesday, according to its daily trading update.

All three funds, as of September 28’s market close, still have Elon Musk’s electric vehicle company as their top holdings at more than 10% each.

Wood, during Monday’s close, also trimmed her Tesla stake. Her ARKW and ARKQ funds sold over 42,000 shares combined.

Her latest move follows a string of sales and is the biggest this month. On September 8, Ark sold a combined 142,708 Tesla shares, worth around $109 million at the time. A week later, Ark sold 81,609 shares worth around $62 million. And on September 17, another 14,362 shares worth $10.9 million were sold.

The star stock-picker has made it a habit to sell Tesla stock when the electric carmaker has either outperformed in a certain duration or has grown too much to her liking in her portfolio.

A surge in yields has battered high-growth technology names. A rise in global bond yields makes the returns on stocks look less attractive.

Still, Wood has recently predicted that the company’s stock price will hit $3,000 by 2025 – a price target that requires the shares of the EV maker to rally an approximately 300% from its current level. But if shares reach that level next year, Wood said September 23 that she would sell her Tesla holdings.

Tesla stock was trading 1.2% higher at $786.89 as of 9:51 a.m. ET Wednesday. Shares have rallied 7.56% in September and gained around 8% year-to-date.

Wood, the founder and CEO of Ark Invest, shot to prominence in 2020 thanks to her blockbuster performance driven by bets into mega-growth stocks. Her ETFs last year have delivered eye-popping returns, with her flagship fund up more than 150% in 2020.

Read the original article on Business Insider

Cathie Wood bought the dip in DraftKings after $20 billion Entain buyout news sent shares tumbling

Cathie Wood, CEO and chief investment officer of ARK Invest, on a purple background with the Ark Invest logos patterned behind her.
Cathie Wood is the CEO and chief investment officer of ARK Invest, which runs three of the highest-returning stock ETFs of the last three years.

  • Cathie Wood’s ARK Invest bought a $40 million stake in DraftKings on Wednesday after the stock tumbled 8.2%.
  • Compared to pre-dip Monday prices, ARK investors saved $3.3 million on the trade.
  • But on Thursday, investment research firm Hedgeye said DraftKings was one of the best short ideas on the market.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

Cathie Wood’s ARK Invest bought an additional $40 million stake in DraftKings on Wednesday after news of a buyout bid for UK sports bettor Entain sent shares tumbling 8.2%.

Two ARK-managed ETFs bought a combined 759,819 shares in the sports betting company a day after the dip. At Wednesday closing prices, the buy was worth just under $40 million. Compared to pre-dip Monday prices, ARK investors saved $3.3 million on the trade.

Wood’s ARKK Innovation ETF now has 10.6 million DraftKings shares and her ARKW Next-Generation Internet Fund has 3.6 million shares.

On Tuesday, CNBC reported that DraftKings had approached Entain with a $20 billion cash-and-stock buyout offer, months after the UK company had rejected a similar $11 billion offer from MGM Resorts. The news propelled Entain shares up 18% but crushed DraftKings stock, which fell more than 8%.

DraftKings has been one of Wood’s go-to stock picks in 2021, with her funds buying dips and sometimes giving the stock a boost with its buy announcements.

But the company has attracted interest from short-sellers since its public debut via SPAC in 2020, including one short-seller alleging exposure to black-market operations stemming from the SPAC. The company has denied the allegations.

On Thursday, investment research firm Hedgeye said DraftKings was one of the best short ideas on the market, citing its “lofty” valuation, aggressive competition, and a tough industry. Hedgeye analysts warned that the stock could be facing a 20%-25% downside risk.

But general Wall Street sentiment seems more sanguine. Of the 25 analysts covering DraftKings listed on FactSet, 17 called the stock “buy” or “overweight,” with the other 8 saying “hold.” None were as bearish as the short-sellers.

Read the original article on Business Insider

Cathie Wood bought the dip in Coinbase and Robinhood stock as Evergrande fears rocked markets

Cathie Wood Ark Invest
Cathie Wood has been trimming Ark Invest’s Tesla holdings.

  • Cathie Wood hoovered up hundreds of thousands of Coinbase and Robinhood shares during Monday’s market sell-off.
  • Funds managed by Wood’s Ark Invest bought 404,020 Robinhood shares and 96,251 Coinbase shares.
  • A buy-the-dip approach has been a key tool in Wood’s investing arsenal.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

Cathie Wood hoovered up hundreds of thousands of Coinbase and Robinhood shares on Monday, taking advantage of a sell-off that hit stocks and crypto across the board.

Funds managed by Wood’s Ark Invest bought a combined 404,020 Robinhood shares and 96,251 Coinbase shares as both companies dipped more than 5%. At Monday’s closing prices, the buys represent an additional $22.8 million stake in Coinbase and $16.4 million in Robinhood.

Buying into Monday’s Evergrande-driven sell-off saved ARK investors around $1.5 million when compared to an equivalent buy at Friday’s closing prices.

A buy-the-dip approach has been a key tool in Wood’s investing arsenal. At various points this year, her funds have bought into short-term declines in bitcoin, Peloton, Zoom, and others.

While Wood’s funds have in the past put in a spectacular, market-crushing performance, 2021 has looked less rosy. Ark’s flagship thematic ETF is down slightly on the year, after growing nearly 140% in 2020.

Others have noticed Ark’s weaker 2021 performance, with some skeptics starting inverse-ARK ETFs or outright shorting Wood’s funds.

But Wood has stuck to her guns, arguing that the long-term bull case for US equities is strong.

“When I see such negative sentiment out there, especially when it comes to valuation and longer time horizons, investment time horizons, I actually feel a little more comfortable,” Wood told CNBC in August.

“I like bad news,” she added.

Read the original article on Business Insider