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Cathie Wood Watch: Ark Piles Into Coinbase and a Videogame Platform

By Dan Weil

Investment hotshot Cathie Wood, chief executive of Ark Investment Management, on Thursday continued to gobble up beleaguered stocks.

That included a cryptocurrency exchange and a videogame-development platform. She did some selling, too. All valuations below are based on the May 12 close.

Ark funds bought 240,791 shares of Coinbase  (COIN) , the largest U.S. cryptocurrency exchange, valued at $14.1 million. The stock has plunged 72% year to date amid weakness in the cryptocurrency market. To be sure, Coinbase has rebounded on May 13.

Ark funds purchased 331,588 shares of Unity Software  (U Get Unity Software, Inc. Report, the San Francisco provider of a videogame-development platform, valued at $11.6 million. The stock has dropped 73% year to date and rebounded a bit on May 13.

On the selling side, Ark funds dumped 533,061 shares of Sea  (SE Get Sea Ltd. (Singapore) Report, the Singapore-based digital entertainment company, valued at $32.8 million. 

Ark Genomic Revolution ETF,  (ARKG Get ARK Genomic Revolution ETF Report, unloaded 111,446 shares of Editas Medicine  (EDIT Get Editas Medicine, Inc. Report, a biotechnology company, valued at $1.2 million.

Ark Next Generation Internet ETF  (ARKW Get ARK Next Generation Internet ETF Report sold 116,812 shares of Nano Dimension  (NNDM Get Nano Dimension Ltd. Report, a provider of equipment for electronics manufacturing, valued at $273,340. 

And Ark Next Generation also shed 52,800 shares of Burning Rock Biotech  (BNR) , valued at $185,856.

Trailing the S&P 500

As Ark funds have tumbled in recent months, Wood has defended herself by noting that she has a five-year investment horizon.

And the five-year track record of her flagship fund Ark Innovation ETF  (ARKK Get ARK Innovation ETF Report could indeed give investors comfort until May 9. The fund’s five-year return beat that of the S&P 500 until then. But the five-year annualized return of Ark Innovation totaled 9.87% through May 12, compared to 12.45% for the S&P 500.

Ark Innovation has slumped 54% this year, as Wood’s young, disruptive technology companies have hit the skids. And it’s down 73% from its February 2021 peak. Raging inflation and soaring interest rates have helped put the kibosh on tech stocks.

Still, Wood’s investors aren’t deserting her. Ark Innovation has enjoyed net inflows so far this year, as of May 9, taking in $41 million May 6, Bloomberg reports.

Morningstar’s View

Meanwhile, on March 29, Morningstar analyst Robby Greengold issued a scathing critique of Ark Innovation.

“ARKK shows few signs of improving its risk management or ability to successfully navigate the challenging territory it explores,” he wrote.

“Since its meteoric rise in 2020, the strategy has been one of the worst-performing U.S.-sold funds.… Wood’s reliance on her instincts to construct the portfolio is a liability.”

Wood countered Greengold’s points in a recent interview with Magnifi Media by Tifin. “I do know there are companies like that one [Morningstar] that do not understand what we're doing,” she said.

“We do not fit into their style boxes. And I think style boxes will become a thing of the past, as technology blurs the lines between and among sectors.”

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Dive Deeper:
Cathie Wood Adds $14M In Coinbase As Stock Weathers Massive Crypto Crash
Cathie Wood-led Ark Investment Management scooped up more shares in Coinbase Global Inc (NASDAQ: COIN) on Thursday as the cryptocurrency trading platform emerged from a massive slump
If You Invested $1,000 In The Coinbase IPO, Here's How Much You'd Have Now
Cryptocurrency platform Coinbase Global Inc (NASDAQ: COIN) had one of the biggest public listings of all time when it went…
Cathie Wood Puts In Another $29M In Coinbase, Showing Conviction In Crypto Stock Amid Sell-Off
Cathie Wood-led Ark Investment Management on Wednesday further raised its exposure in Coinbase Global Inc (NASDAQ: COIN) on the day…
Dow Jones Jumps As Stocks Strike Back; Twitter Plunges On Elon Musk Move; Warren Buffett Stock Offers Buy Point
The Dow Jones rallied as stocks fought back. Twitter plunged on a move by Tesla CEO Elon Musk. A Warren…
One subscription that gives you access to news from hundreds of sites
Dow Jones Futures Extend Stock Market Sell-Off; This Should Worry Investors
The stock market tumbled Wednesday on a hot inflation report. A lack of investor fear suggests no market bottom yet.
Dow Jones Futures Jump; TWTR Stock Crashes, Pares Losses On Elon Musk's Twitter Deal Tweets
Futures are rising. Will this bounce stick? TWTR stock initially crashed as Tesla CEO Elon Musk put the Twitter deal…
Get all your news in one place