Cathie Wood, the star fund manager and chief executive of ARK Invest, took to CNBC to defend the woeful performance of the manager's suite of disruptive innovation funds.
Cathie Wood thinks the gravitation of money managers toward benchmarks, rather than taking risk on what she views as potentially game-changing technology in gene editing, electric vehicles and artificial intelligence, among others, was creating a 'massive misallocation of capital' in markets that could be the biggest in 'the history of mankind.'
Benchmarks are where they are because of past successes...If we are right, those are the companies that will be disrupted."
--- she said on CNBC.
She said "absolutely," when asked if some of the companies her funds have invested in, which enjoyed nearly parabolic run-ups during the height of the pandemic-fueled worries in 2020, would return to their pandemic heights.
"We are not going back to the old ways of doing things," she said about the surge in value in the cache of stocks bought by ARK that saw revenue accelerate during the COVID public health crisis.
To those who are betting on the failure of ARK, Wood said the idea of shorting innovation is "ridiculous," referencing funds, including $Tradr 2X Short Innovation Daily ETF (SARK.US)$, which can be used to wager against ARK's roster of investments.
The idea of shorting innovation in America is ridiculous, I think."
---she said.
However, $ARK Innovation ETF (ARKK.US)$ fell 28% and $Tradr 2X Short Innovation Daily ETF (SARK.US)$jumped 30% so far in 2022.
By comparison, the $Dow Jones Industrial Average (.DJI.US)$ was down 5.5% in the year to date, the $S&P 500 Index (.SPX.US)$ was trading 8% lower over the same period, the $Nasdaq Composite Index (.IXIC.US)$ has declined by 12.3%, as of this Thursday.
Do you agree with Cathie Wood? How do you think of pandemic-related stocks?
Source: CNBC, Market Watch