If you’re looking for a pair of star investors with diametrically opposed investment philosophies, Warren Buffett and Cathie Wood fit the bill.
Berkshire Hathaway’s (BRK.B) - Get Berkshire Hathaway Inc. Class B Report Buffett invests in tried-and-true blue-chip stocks, such as Apple (AAPL) - Get Apple Inc. Report and Coca-Cola (KO) - Get Coca-Cola Company Report.
Meanwhile, Ark Investment Management’s Wood invests in speculative, technology stocks, such as Zoom Video Communications (ZM) - Get Zoom Video Communications, Inc. Class A Report and Teladoc Health (TDOC) - Get Teladoc Health, Inc. Report.
But as Bloomberg points out, the two heavyweight investors have produced similar performance over the past two years, with the flagship Ark Innovation ETF (ARKK) - Get ARK Innovation ETF Report posting a total return of 39%, compared with 35% for Berkshire.
To be sure, the paths to those returns have been quite different. Ark Innovation soared 157% in 2020, as Wood’s disruptive tech stocks were in vogue. But last year, the fund dropped 23%, as tech stocks corrected amid rising interest rates. And it has slid another 24% so far this year.
Berkshire Hathaway, on the other hand, has experienced much milder moves, with steady, moderate gains. Its share price rose about 15% in 2020 and about 29% in 2021. It has gained 2% so far this year. Berkshire has benefited from the market’s shift to a focus on value investing from its previous obsession with growth.