Silin Chen
5 min read
In This Article:
Cathie Wood, head of Ark Investment Management, is known for making bold bets on disruptive innovation, mostly in the U.S.
But this week, she looked abroad, buying an Asian chipmaker as investor optimism around AI infrastructure and semiconductors returns following signs of easing tariffs.
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In April, President Donald Trump raised tariffs on Chinese goods to as high as 145%, prompting swift retaliation from Beijing and triggering a sharp market sell-off as tensions flared between the world’s two largest economies.
Earlier this month, the U.S. and China struck a rare deal in Geneva to temporarily cut tariffs as both sides work toward a broader agreement.
Wood’s funds saw a brief bump after Trump won the presidency last November, but that momentum didn’t go far. Her flagship Ark Innovation ETF (ARKK)  underperformed the S&P 500 index amid broader market volatility.
Year-to-date, ARKK is down 2.67%, slightly worse than the S&P 500’s loss of 1.34%.
Wood gained a remarkable 153% in 2020, which helped build her reputation and attract loyal investors. Still, her long-term performance has made many others skeptical of her aggressive style.
As of May 23, Ark Innovation ETF, with $5 billion under management, has delivered a five-year annualized return of negative 1.75%. In comparison, the S&P 500 has an annualized return of 16.20% over the same period.
Wood’s investment strategy is straightforward: Her Ark ETFs typically buy shares in emerging high-tech companies in fields such as artificial intelligence, blockchain, biomedical technology, and robotics.
Wood says these companies have the potential to reshape industries, but their volatility leads to major fluctuations in Ark funds' values.
Related: Cathie Wood's net worth: The Ark Invest CEO's wealth & income
The Ark Innovation ETF wiped out $7 billion in investor wealth over the 10 years ending in 2024, according to an analysis by Morningstar’s analyst Amy Arnott. That made it the third-biggest wealth destroyer among mutual funds and ETFs in Arnott’s ranking.
Wood recently said the U.S. is coming out of a three-year “rolling recession” and heading into a productivity-led recovery that could trigger a broader bull market.
In a letter to investors published on April 30, she dismissed predictions of a recession dragging into 2026, as she expects "more clarity on tariffs, taxes, regulations, and interest rates over the next three to six months."
