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Ark's Cathie Wood Says Long Term Still Bright for Her Stocks

'We have a five-year horizon. I’ve never seen innovation on sale like it is today,' said Wood, CEO of Ark Investment Management.
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Cathie Wood, CEO of Ark Investment Management, said Tuesday that she can feel her investors’ pain but things will get better.

“I can understand what investors are going through today, given the uncertainty and volatility,” Wood said in introductory remarks to Ark’s Big Ideas webinar. “But volatility isn’t always a bad thing. Volatility on the upside was a beautiful thing 12 to 18 months ago.”

Wood’s flagship fund, Ark Innovation ETF  (ARKK) - Get ARK Innovation ETF Report, soared 157% in 2020, but then slid 23% last year and has dropped another 26% so far this year.

The speculative technology stocks in the fund -- what Wood calls “disruptors” -- have suffered from rising interest rates, which lessen the stocks’ attractiveness compared to safe investments like Treasury bonds.

Ark Innovation’s biggest holdings are electric car maker Tesla  (TSLA) - Get Tesla Inc Report, video-conferencing company Zoom Video Communications  (ZM) - Get Zoom Video Communications, Inc. Class A Report, online-health service Teladoc Health  (TDOC) - Get Teladoc Health, Inc. Report and streaming platform Roku  (ROKU) - Get Roku, Inc. Class A Report.

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Wood is unbowed by the decline of Ark funds.

“The important thing to keep in mind is the long-term horizon that we invest in,” she said. “We have a five-year horizon. I’ve never seen innovation on sale like it is today.”

Wood noted that valuations for privately-held tech companies have held up much better than for their publicly-traded brethren.

“Prices continue to rise in the private market,” she said. The private markets have it more right than the public markets, she maintained.

“It is crucial for investors to get on the right side of this.”