In this piece, we will take a look at Cathie Wood's stock portfolio for 2024. If you want to skip our overview of Wood, her firm, and the latest news revolving around her hedge fund, then you can skip ahead to Cathie Wood's Stock Portfolio: Top 5 2024 Stock Picks.
In contrast to some of the biggest hedge fund managers that aim to diversify their portfolios to capitalize on both growth and value stocks, Cathie Wood and her hedge fund, ARK Investment Management, are purely focused on growth and investments in "technologically enabled innovation that cuts across economic sectors and changes the way our world works." The firm's investment strategy encompasses themes such as Autonomous Technology, Robotics, Artificial Intelligence (AI), Blockchain Technology, Multi-Omics, Space Exploration, and Energy Storage. While her funds have garnered attention for their innovative approach, they have also experienced mixed results over the years, with some describing them as rollercoaster rides. ARK Invest experiencing one of its most successful years since its inception in 2017, achieving an impressive 87.4% gain propelled by a 1,300% surge in Grayscale Bitcoin Trust. This performance coincided with Bitcoin reaching record highs of $20,000 per coin.
However, it was in 2020 that Wood established her reputation on Wall Street, delivering a massive 152.5% gain with her flagship fund amidst the pandemic. The fund achieved this by investing in stocks associated with "disruptive innovation," such as Teladoc Health, Inc. (NYSE:TDOC) Roku, Inc. (NASDAQ:ROKU), and Zoom Video Communications, Inc. (NASDAQ:ZM). In addition, Wood's ARK Innovation (ARKK) exchange-traded fund (ETF) emerged as the top-performing global equity fund that same year with at least $1 billion of assets. However, as the high-flying pandemic stocks experienced a subsequent downturn, Wood's flagship fund underperformed the S&P 500 index by more than 30 basis points in both 2021 and 2022. In addition, the ARKK ETF sharply underperformed the Nasdaq in 2021, closing down 24% compared to the Nasdaq's 21.4% advance. This underperformance persisted in 2022, with the ARKK ETF plummeting 67% versus the Nasdaq's 33.1% annual loss. However, there was a notable turnaround in 2023, with the ARKK ETF rebounding strongly, posting a 67.6% gain. The tech sector, in particular, faced challenges following the Federal Reserve's decision to pursue an aggressive interest rate-hiking campaign last year.
In January 2024, Cathie Wood made headlines again when she raised her bullish estimate for Bitcoin's price to $1,500,000 by 2030, marking a 50% increase from her previous prediction of $1 million. Wood attributed the increased likelihood of this optimistic scenario to the recent SEC approval of spot Bitcoin ETFs in the United States, which she views as a green light for the cryptocurrency. On the other hand, the hedge fund manager also anticipates a price of $258,500, while the base case is set at $682,800. ARK Invest supported its projections by pointing to factors such as a higher hash rate, long-term holder supply, and addresses with a non-zero balance.
Here is what the hedge fund manager had to say to after the SEC's Bitcoin ETF approval:
Typically in a situation like this where there are a lot of competitors, the market consolidates. So we would expect that to happen. We hope and trust that we will be one of the winners. And I think from our pint of view we have some competitive advantages. A lot of people are talking about fees, and I'll get to that. But there are three competitive advantages that i think are very important. One, our infrastructure and operations. Our partner 21shares has built this infrastructure, and then operating 40 different funds through booms and busts, through halvings and forks, and airdrops and you know through periods that the ETF industry just has never seen. So our infrastructure is battle tested. The second is research. As you know we give all of our research away. Our first blog on Bitcoin was the year of our founding, 2014. Our first whitepaper, Bitcoin Couldn't Serve The Three Roles of Money, we did in collaboration with Art Laffer. In 2015. We gained our first exposure in Bitcoin at $250 and have never left it.
We think this story has just begun. So we've been putting prolific research out there, and now we have the Bitcoin monthly report, and a Bitcoin brainstorm monthly. So we continued to give our researc h away, as does our partner at 21shares. And then the third, and this is not to be underestimated. The third competitive advantage that we have is a sales force that started selling our exposure to Bitcoin in 2016. That's when we partnered with Resolute Investment Management.
With these details in mind, let's take a look at some of the best stocks in Cathie Wood's stock portfolio. Some notable names in this list include Tesla, Inc. (NASDAQ:TSLA), UiPath Inc. (NYSE:PATH), and Coinbase Global, Inc. (NASDAQ:COIN), among others.
Cathie Wood of ARK Investment Management
OurMethodology
We selected the following 10 stocks from Cathie Wood’s ARK Invest portfolio as of Q4 2023. We have also mentioned the hedge fund sentiment towards each stock, which was assessed from Insider Monkey’s database of 933 elite hedge funds tracked as of the end of the last quarter of 2023. The list is arranged in ascending order of the number of ARK Invest’s stake value in each holding.
Hedge funds’ top 10 consensus stock picks outperformed the S&P 500 Index by more than 140 percentage points over the last 10 years (see the details here).
10. Unity Software Inc. (NYSE:U)
Number of Hedge Fund Investors: 38
Ark Investment's Q4 2023 Investment Value: $498.4 million
Unity Software Inc. (NYSE:U) is a San Francisco-based American video game software development company. Originally established in Denmark in 2004 as Over the Edge Entertainment, it underwent a name change in 2007. The company oversees a platform that provides software solutions for creating, managing, and monetizing interactive, real-time 2D and 3D content tailored for mobile phones, tablets, PCs, consoles, and AR/VR devices.
As of the end of the fourth quarter of 2023, 38 hedge funds tracked by Insider Monkey had stakes in Unity Software Inc (NYSE:U). The most notable stake in Unity Software Inc (NYSE:U) is owned by Jim Davidson, Dave Roux and Glenn Hutchins’s Silver Lake Partners which owns a $1.4 billion stake in Unity Software Inc (NYSE:U).
Much like Tesla, Inc. (NASDAQ:TSLA), UiPath Inc. (NYSE:PATH), and Coinbase Global, Inc. (NASDAQ:COIN), Cathie Wood holds one of the biggest positions in Unity Software Inc. (NYSE:U).
9. CRISPR Therapeutics AG (NASDAQ:CRSP)
Number of Hedge Fund Investors: 26
Ark Investment's Q4 2023 Investment Value: $534.36 million
CRISPR Therapeutics AG (NASDAQ:CRSP) is a biotechnology company with dual Swiss–American headquarters located in Zug, Switzerland. Pioneering the use of the CRISPR gene editing platform, the company focuses on developing medicines for a range of rare and common diseases.
In January, Vertex Pharmaceuticals (NASDAQ:VRTX) announced that the US FDA had approved its groundbreaking gene editing therapy, Casgevy, developed in collaboration with CRISPR Therapeutics AG (NASDAQ:CRSP), for individuals aged 12 years and older diagnosed with transfusion-dependent beta-thalassemia (TDT).
Out of the 933 hedge funds included in Insider Monkey’s Q4 2023 database, 26 had purchased shares of CRISPR Therapeutics AG (NASDAQ:CRSP). Catherine Wood’s ARK Investment Management emerged as the largest investor with its $325 million investment.
8. Twilio Inc. (NYSE:TWLO)
Number of Hedge Fund Investors: 47
Ark Investment's Q4 2023 Investment Value: $540.96 million
Twilio Inc. (NYSE:TWLO), headquartered in San Francisco, California, is an American company that offers programmable communication tools, facilitating various communication functions through its web service APIs, including making and receiving phone calls and sending and receiving text messages.
On January 8, Twilio Inc. (NYSE:TWLO) announced the appointment of a new CEO and shared optimistic forecasts for the upcoming quarter. The company expects its fourth-quarter guidance, initially outlined on November 8, to exceed expectations, with adjusted earnings projected to range from 53 to 57 cents per share and a revenue outlook of $1.03 billion to $1.04 billion.
As of the end of December 2023, 47 out of the 933 hedge funds included in Insider Monkey’s database had invested in Twilio Inc. (NYSE:TWLO). The largest investor was David Blood and Al Gore’s Generation Investment Management, with ownership of 8.5 million shares valued at $645 million.
7. Roblox Corporation (NYSE:RBLX)
Number of Hedge Fund Investors: 50
Ark Investment's Q4 2023 Investment Value: $544.35 million
Roblox Corporation (NYSE:RBLX), a leading online entertainment platform known for facilitating game creation, represents one of the most advanced iterations of a functional metaverse today. With an impressive user base of 50 million daily active users, Roblox Corporation (NYSE:RBLX) goes beyond traditional video gaming, incorporating its digital currency and offering a diverse range of unique virtual experiences.
According to Insider Monkey’s study covering 933 hedge funds, 50 had held a stake in Roblox Corporation (NYSE:RBLX). The largest investor was ARK Investment Management, which owned 11.9 million shares valued at $544.35 million.
In addition to Tesla, Inc. (NASDAQ:TSLA), UiPath Inc. (NYSE:PATH), and Coinbase Global, Inc. (NASDAQ:COIN), Roblox Corporation (NYSE:RBLX) ranks as one of ARK Invest’s top picks.
6. Zoom Video Communications, Inc. (NASDAQ:ZM)
Number of Hedge Fund Investors: 41
Ark Investment's Q4 2023 Investment Value: $788.46 million
Zoom Video Communications, Inc. (NASDAQ:ZM), headquartered in San Jose, California, is a communications technology company that gained significant traction during the pandemic, becoming a household name during lockdowns. Now, Zoom Video Communications, Inc. (NASDAQ:ZM) is focused on introducing several essential features for businesses, including word processing capabilities and increased utilization of artificial intelligence to enhance its flagship video conferencing service.
Over the past year, Zoom Video Communications, Inc. (NASDAQ:ZM) has surged by over 13%, driven by positive announcements and solid numbers released during the company’s recent Q4 2023 earnings report. Projections for Q1 2024 earnings per share indicate $1.18 per share of adjusted earnings, with revenue expected to spike to $1.125 billion, signaling strong growth for the video communications leader.
41 out of the 933 hedge funds part of Insider Monkey’s Q4 2023 database were the firm’s shareholders. Zoom Video Communications, Inc. (NASDAQ:ZM)’s largest investor fund shareholder was ARK Investment Management itself, since it owned a $788.46 million stake.
Meridian Hedged Equity Fund made the following comment about Zoom Video Communications, Inc. (NASDAQ:ZM) in its Q3 2023 investor letter:
“Zoom Video Communications, Inc. (NASDAQ:ZM) provides video conferencing software widely used for virtual meetings, webinars, and online collaboration by businesses, schools, and individuals. The company has shown stability in its business model after a remarkable rise in 2020. While its valuation is more reasonable now, the company maintains strong operating margins. The enterprise sector, particularly through successful upselling, has shown resilience despite economic headwinds and seat churn. Zoom’s contact center solution has shown early traction with a growing roster of customers and a rapid rollout of new features, showing strong potential for future growth. The stock performed well during the quarter following results that exceeded expectations, reaffirming its potential for growth.”
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Disclosure: None. Cathie Wood's Stock Portfolio: 2024 Stock Picks.is originally published on Insider Monkey.
