Famed money manager Cathie Wood, chief executive of Ark Investment Management, bought and sold some of her same favorite names for the second day in a row Thursday.
All transaction valuations are as of Thursday’s close
Ark funds purchased 63,585 shares of Coinbase Global COIN, the largest U.S. cryptocurrency exchange, valued at $4 million.
Wood has built up her Coinbase position for months. The company posted a $557 million loss for the fourth quarter.
Coinbase shares have tumbled 66% over the past year amid turmoil in the cryptocurrency market. But they have rebounded 65% so far this year, helped by bitcoin’s ascent.
Coinbase is the sixth biggest holding in Ark’s flagship Ark Innovation ETF (ARKK), moving up a place Thursday.
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On the selling side, Ark Innovation unloaded 127,317 shares of Exact Sciences EXAS, valued at $7.8 million. The company is a medical diagnostics provider famous for its Cologuard at-home colon-cancer test.
Exact Sciences shares have climbed 22% thus far in 2023, buoyed by strong earnings and the overall market rally.
That said, the stock has descended 12% over the past year. Wood has unloaded more than 2 million Exact Sciences shares this year. But the company is still the fourth biggest holding in Ark Innovation ETF.
Ark Next Generation Internet ETF ARKW dumped 125,333 shares of online sports gambling platform DraftKings DKNG, valued at $2.4 million as of Thursday’s close.
The stock has lost 7% in the past year but has jumped some 60% year to date amid strength in the sports-gambling market. DraftKings is the 11th biggest holding for Ark Innovation ETF.
Wood’s Returns Tumble
Meanwhile, Wood’s performance hasn’t exactly overwhelmed the investment world over the past year, as her young technology stocks have slumped. Ark Innovation has descended 37% during that period and 76% from its February 2021 peak.
Still, the fund has bounced back 23% so far this year, as tech stocks have rebounded in general.
Wood defends her strategy by noting that she has a five-year investment horizon. But the five-year annualized return of Ark Innovation was only 0.36% through Feb. 23, compared with 9.79% for the S&P 500.
The fund’s performance also doesn’t come close to Wood’s goal for annualized returns of 15% over five-year periods.
Ark Innovation, with $7.3 billion in assets, suffered a net investment outflow of $309 million during the past five days, according to ETF research firm VettaFi. But it enjoyed an inflow of $812 million over the last year.
What Draws Investors to Wood
You might wonder why so many investors have stuck with Wood. The fact that she had one spectacular year certainly helps. Ark Innovation skyrocketed 153% in 2020.
Also, Wood has become something of a rock star in the investment world, appearing frequently in the media. She explains financial concepts in ways that novice investors can understand.
Wood does have her detractors. Morningstar analyst Robby Greengold issued a scathing critique of Ark Innovation last year.
“ARKK shows few signs of improving its risk management or ability to successfully navigate the challenging territory it explores,” he wrote.
Wood, of course, begged to differ. “I do know there are companies like that one [Morningstar] that do not understand what we're doing,” she said in an interview with Magnifi Media by Tifin.
