Cathie Wood buys $18.5 million of popular AI stock originally appeared on TheStreet.

Cathie Wood, head of Ark Investment, often buys tech stocks she believes will have a disruptive impact on the future. Sometimes she chases stocks at high prices, believing their long-term potential outweighs short-term volatility.

This is what she just did, adding shares of a popular AI stock nearing an all-time high on June 16.

Wood’s funds have experienced a volatile ride this year, swinging from strong gains to sharp losses and now back to outperforming the broader market.

In January and February, the Ark funds rallied as investors bet on the Trump administration's potential deregulation that could benefit Wood’s tech bets. But the momentum faded in March and April, with the funds trailing the market as top holdings—especially Tesla, her biggest position  —slid amid growing concerns over the macroeconomy and trade policies.

Related: Veteran analyst unveils bold price target for Tempus AI stock

Now, the fund is regaining momentum. As of June 18, the flagship Ark Innovation ETF  (ARKK)  is up 15.9% year-to-date, outpacing the S&P 500’s 1.9% gain.

Wood had a remarkable gain of 153% in 2020, which helped build her reputation and attract loyal investors. Her strategy can lead to sharp gains during bull markets, but also painful losses, like in 2022 when ARKK dropped more than 60%.

As of June 17, Ark Innovation ETF, with $5.5 billion under management, has delivered a five-year annualized return of negative 0.3%. The S&P 500 has an annualized return of 15.7% 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 in late April, 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."