Morning Wood: Cathie’s ARK Adds Coinbase, Tesla, Says Portfolios Will “More Than Triple” In Five Years

Morning Wood: Cathie’s ARK Adds Coinbase, Tesla, Says Portfolios Will “More Than Triple” In Five Years

It seems like with every day that goes by, Cathie Wood figures out a way to double down on her strategies even further. 

We’ve been noting each time that Wood does something to push the envelope – including selling liquid big tech names to rotate into speculative names, claiming she “loved the setup” when the NASDAQ corrected off highs recently, amending the prospectuses to her ETFs to allow more concentrated positions and buying more Tesla as it fell earlier this week. 

And, heading into the back end of the week, the beat goes on. On Wednesday of this week, Wood added more Tesla and Coinbase in the face of bitcoin’s spectacular crash and continued volatility and questions about both logistics hell and fading sales for Tesla in China

ARK buying more $TSLA and $COIN https://t.co/LzP6EQalbf

— Eric Balchunas (@EricBalchunas) May 20, 2021

And when she’s not doubling down with her capital, she’s doubling down with her rhetoric. 

On Wednesday morning, Wood reportedly told a Businessweek event that: “If our research is correct, no promises, we believe our portfolios will more than triple over the next five years, so that’s more than a 25% annual rate of return. These innovation platforms have hit escape velocity. There is no turning back.”

There is no turning back, for sure, Cathie…

Further trying to reassure investors about her ETFs, she also said: “There were a lot of commentators out there screaming about how our ETFs would have to shut down which is impossible. They don’t understand the ETF infrastructure. It’s beautiful. And the flows are no problem our spreads have not moved.”

“Our price targets over the next five years have not changed. In fact some of them have gone up a bit after quarterly results. The forces that COVID put in motion, they are not looking back. So we looking at this correction we just see discounts,” she continued.

Commenting on Bitcoin at a Businessweek event, she said she thought Elon Musk would eventually “come back to the mix” for the crypto. 

Cathie re Elon/Bitcoin: “I believe what happened is after he took position in bitcoin he got pushback from inst shareholders like BlackRock. You’ve got Larry Fink beating drum on climate change. I don’t think he expected that. But I think he’ll come back to the mix” via @BW event

— Eric Balchunas (@EricBalchunas) May 19, 2021

But despite this – and her ever-increasing weighting in crypto and speculative assets – Wood claimed it is a “risk off period for all assets”. 

“I think we are in a risk off period for all assets. The correlations of volatile asserts are going to 1 right now, including bitcoin. We go through soul searching times like this but our conviction on bitcoin remains high.” – Cathie Wood rn at @BW event to @carolmassar

— Eric Balchunas (@EricBalchunas) May 19, 2021

She also took the time to defend her analysts, calling them ARK’s “secret weapon”. 

Cathie on critics of her young analyst team: “They are our secret weapon. Those analysts have their education and feet in the new world. They are coming to us from college with domain expertise in a way most (Wall St) analysts are not.” via @BW event.

— Eric Balchunas (@EricBalchunas) May 19, 2021

Recall, earlier this week we wrote that Wood’s ARKK had fallen 35% off highs and that Wood’s firm was back under $40 billion in AUM. Days before that, we noted that Wood had admitted to having four of her ETFs seeded by Bill Hwang, most recently best known for his $80 billion levered blowup that created chaos among banks and drove the price of several equities down over 50% in a week’s time. 

“Bill was very intrigued with the stocks we were interested in, he was just beginning to learn about them” she said at the time. When asked about whether or not she had spoken to Hwang after his blow up, Wood said: “I have not spoken to him. I send him a note after the unfortunate events we witnessed.”

When asked if Hwang still had a position in any ARK funds, Wood replied: “To be honest, I have no idea. I never asked him if he kept the money in. We’ve never had that conversation.”  

Tyler Durden
Thu, 05/20/2021 – 08:24

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