Cathie Wood loves her stock setup after the sale and expects big returns from her strategies – fr

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Cathie Wood loves her stock setup after the sale and expects big returns from her strategies – fr


Cathie Wood, founder of Ark Invest, said on Friday that the pullback in tech stocks is not a cause for concern and that her long-term bets will pay off over time.
“I love this setup,” she said on CNBC’s “Closing Bell” Friday. “The worst thing that could have happened to us is for the market to narrowly focus only on our stocks – the innovation space. “

Amid the rotation out of high growth areas of the market, some of Wood’s strategies are now down more than 30% from their February high.

“From our perspective – five year horizon – nothing has changed except the price,” she said. In February, Wood expected a compound annual rate of return of 15% on her strategies, but after the recent price drop, she expects that number to reach between 25% and 30%.

While Wood sticks to her long-term bets, one name she sells is Apple. The fund is not allowed to hold cash, so dollars are instead stored in what Wood called “cash-like innovation stocks,” which includes Apple.

“The FAANG certainly meet these criteria – they act as defenders,” she said. “During a period of volatility as we have just seen, we will sell these stocks and we will move towards our more pure-play or older innovation companies which are suffering from risk reduction. “

Wood’s flagship fund Ark Innovation gained ground on Friday along with the broader tech sector, although the fund is still down more than 9% for the week.

Amid the weakness, around $ 760 million was withdrawn from the fund last week, according to FactSet data.

Yet despite the exits, Wood said the company has yet to see a month of buybacks.

Wood rose to fame in 2020 when his suite of exchange-traded funds – focused on areas such as the genomics revolution and robotics – far surpassed the market in general.

As his business grew in importance, his funds became very popular. Ark vehicle assets have grown from $ 10 billion to $ 80 billion in just 10 months.

“It’s parabolic. We’re used to exponential growth – that’s what we do. Our Ark strategies, our Ark innovation platforms that we believe will evolve exponentially, and therefore our capacity should evolve exponentially. 10 billion to 80 billion was a little faster than that, ”she said.

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