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Honestly though, I'm not sure what she should have done differently. Her funds are pretty transparently about making wild speculative bets and that's the brandi

Honestly though, I'm not sure what she should have done differently. Her funds are pretty transparently about making wild speculative bets and that's the branding she's known for. People piled in on the hopes that her speculative bets would continue to pan out as they did before. Like, sure, if she'd been able to, she could have saved her investors a lot of money if she sold everything last year and held cash, with each of her ETFs remaining frozen near the top. But that would defeat the purpose of having ETFs open to public investors. And maybe so would buying instruments that hedge against declines in her picks. Yeah investors who piled into her fund near the top got burned but it's not like they got bait-and-switched.

etempleton 4y ago
If people knew what they were doing they wouldn't need hedge funds. I don't think anyone got bait-and-switched. caveat emptor I suppose.
- ajasmin 4y ago
  Major nitpick: ARK is not a hedge fund but an ETF. My understanding is that it tracks an actively managed list of public stocks. I'm sure it's not much consolation, but "actual" hedge funds are for the sophisticated investor. These funds have access to more sophisticated ways of wiping out investor money.
ajasmin 4y ago
You're right. Cathie Wood's ARK is all about "disruptive innovation". It's no surprise to see the fund falling after tech. stocks were so grossly inflated. As an investment strategy, it's a long-term play. Whether the holdings make sense is a whole other question. But don't expect a huge change in strategy just because the markets are down.
xiphias2 4y ago
She got captured by her own success: after she got successful, CEOs of crappy companies, like Teladoc (number 1 position in their genetics ETF) started to approach her team directly and the days of using open data for evaluating stocks was over. At this point ARK invest is looked upon as an exit strategy for startups instead of making profit. Any sane person knows that Teladoc has no experience in genetic therapeutics (unlike BEAM for example, which has a chance of fixing genetic mutations without a double stranded break...I call that disruptive innovation).
jdasdf 4y ago
>Honestly though, I'm not sure what she should have done differently. Oh there was nothing she could have done different. From the moment she decided her fund would be an ETF she was essentially locked out of the one action that could have avoided this.

etempleton 4y ago

If people knew what they were doing they wouldn't need hedge funds. I don't think anyone got bait-and-switched. caveat emptor I suppose.

ajasmin 4y ago
Major nitpick: ARK is not a hedge fund but an ETF. My understanding is that it tracks an actively managed list of public stocks. I'm sure it's not much consolation, but "actual" hedge funds are for the sophisticated investor. These funds have access to more sophisticated ways of wiping out investor money.

ajasmin 4y ago

You're right. Cathie Wood's ARK is all about "disruptive innovation". It's no surprise to see the fund falling after tech. stocks were so grossly inflated. As an investment strategy, it's a long-term play. Whether the holdings make sense is a whole other question. But don't expect a huge change in strategy just because the markets are down.

xiphias2 4y ago

She got captured by her own success: after she got successful, CEOs of crappy companies, like Teladoc (number 1 position in their genetics ETF) started to approach her team directly and the days of using open data for evaluating stocks was over. At this point ARK invest is looked upon as an exit strategy for startups instead of making profit. Any sane person knows that Teladoc has no experience in genetic therapeutics (unlike BEAM for example, which has a chance of fixing genetic mutations without a double stranded break...I call that disruptive innovation).

jdasdf 4y ago

>Honestly though, I'm not sure what she should have done differently. Oh there was nothing she could have done different. From the moment she decided her fund would be an ETF she was essentially locked out of the one action that could have avoided this.