Cathie Wood’s Top 10 Stock Picks
In this article we discuss Cathie Wood’s top 10 stock picks. You can skip our detailed analysis of Cathie Wood’s investment strategy and go directly to Cathie Wood’s Top 5 Stock Picks.
Ark Investment’s Cathie Wood has become one of the most popular hedge fund managers and investors, thanks to her successful bets on technology, EV companies, biotech and DNA sequencing. The 65-year-old is, however, facing a difficult time as tech stocks begin to lose value and small biotech companies in which Ms. Wood’s ETFs have big positions are posting heavy losses. According to data from FactSet, two main ETFs of Cathie Wood posted their biggest losses since the stock market’s crash of March 2020. ARK Innovation Fund is also down 5% over the last 30 days.
Why Is Cathie Wood’s ARK ETF Suddenly Losing Value?
Rising bond yields and a much-feared correction for tech stocks are causing the latest troubles for Cathie Wood’s favorite stock picks. The 10-year Treasury yield ticked up 1.5% after Fed Chairman Jerome Powell in an interview showed no intention to hike interest rates.
High yields often hammer growth stocks. In a Yahoo Finance program in January, Charles Schwab’s strategist Kathy Jones had said that we should expect higher inflation down the road and also mentioned her outlook about growth tech stocks. Here’s what she said:
“We actually moved from Overweight to Neutral [on tech stocks] a couple of months ago. Mainly because valuations were so stretched and we thought that there was room for a correction.”
Cathie Wood’s Dramatic Rise
With a bachelor’s degree in finance and economics from the University of Southern California, Ms. Wood started her career as an assistant at the LA-based financial services company Capital Group. After serving at senior positions at Jennison Associates, Tupelo Capital Management and AllianceBernstein, Ms. Wood founded ARK Investment Management in 2014 and quickly became successful due to her prescient investments in disruptive technology companies. ARK’s most famous Innovation ETF returned an impressive 152% in 2020, defying the struggling hedge fund industry and gaining Ms. Wood the best stock-picker of the year title from Bloomberg.
Cathie Wood talked about several important topics during a recent talk on her ARK’s YouTube channel. We will mention some of the most useful commentary from the video.
Cathie Wood on Monetary Policy
“With chairman Powell’s testimony this week in front of congress, we see that the Fed is nothing but supportive. We see M2 growth still up in the mid-20s. A very rapid rate of growth. The chairman emphasized once again that they’re focused on two things. Full employment, and we are far away from that. Then inflation, above 2% and consistently above 2% on a year-over-year basis. We are not there yet. We’re in the 1.5% to 2% range so nothing right now suggests that the Fed is going to tighten except for maybe the…
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