Cathie Wood has defended the investment portfolio of Ark Invest. Her recent sentiments come from a major sell-off recorded across the technological financial sector. Tech financial products have been dealt a major blow, and this has harmed the investment position taken by Ark Invest.
Ark Invest will see spectacular returns in five years
In an interview with CNBC, Wood noted that “Given our expectations for growth in these new technologies, I think we’re going to see some spectacular returns.” The tech sell-off has affected the Ark Innovation ETF, with its value dropping by nearly half during the past year.
Despite the slump in the tech sector, the S&P 500 has gained by around 15% during the same time. “If you look from the bottom of the coronavirus to that peak [of the ARK Innovation ETF] in February of ’21, we were up 358%,” Wood said.
She also stated that Ark Invest had recorded “significant inflows” since January 17. Data from ETF.com shows that the firm had recorded around $1 billion inflows since this date. She further expressed optimism that the investor base was averaging down to allow people to buy at low prices.
Wood noted that several developments globally were creating “all kinds of problems” and that innovation was the solution. Some of the issues mentioned include the Russia-Ukraine crisis that has propelled crude oil prices. She noted that this could boost innovation that comprises switching to electric vehicles.
Ark Invest’s portfolio leans towards technology
She mentioned that Ark Invest was like a venture capital fund in the public market sector, which did not have the same stand on technology companies as the private sector. She stated that the public market comprised investors who were “benchmark sensitive.” However, investors were drawn towards “explosive growth opportunities” in the private sector.
Nevertheless, the S&P 500 has also invested in technology, comprising 28% of the index. “Our technology stocks are going to be the future success, and they will end up in the indexes,” she concluded.
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