ARK Buys the Dip in Tesla, Shows Strength in Active Management

ARK Invest’s Cathie Wood recently increased the ARK Innovation ETF (ARKK)‘s position in Tesla (TSLA), buying the dip, demonstrating an advantage of active management.

On Thursday, ARK’s flagship fund added 66,190 shares of Tesla as the stock declined, reaching a 52-week low, closing at $202 per share with a loss of 6.7% following Tesla’s third-quarter earnings report, Barron’s reported

Shares of Tesla were up nearly 3% in mid-day trading on Friday, reaching $213 per share.

ARK added more Tesla stock to its portfolio in early October after the shares fell in response to news that third-quarter deliveries were weaker than expected, Barron’s reported in October. Wood sold Tesla stock in early 2022, back when shares were trading between $300 and $350 a piece, according to Barron’s.

ARKK is an actively managed ETF that invests at least 65% of its assets in companies relevant to the investment theme of disruptive innovation. ARK defines ‘‘disruptive innovation’’ as introducing a technologically enabled new product or service that potentially changes the way the world works.

This includes companies that rely on or benefit from the development of new products or services, technological improvements, and advancements in scientific research relating to the areas of DNA technologies and the “genomic revolution”; automation, robotics, and energy storage; artificial intelligence and the “next generation internet”; and fintech innovation.

Other ARK Invest funds that offer exposure to Tesla include the ARK Autonomous Technology & Robotics ETF (ARKQ), and the ARK Next Generation Internet ETF (ARKW).

ARKQ invests in companies focused on and expected to substantially benefit from the development of new products or services, technological improvements, and advancements in scientific research related to, among other things, energy, automation and manufacturing, materials, artificial intelligence, and transportation. These companies may develop, produce, or enable autonomous transportation, robotics and automation, 3D printing, energy storage, and space exploration. 

Companies within ARKW are focused on and expected to benefit from shifting the bases of technology infrastructure to the cloud, enabling mobile, new, and local services, such as companies that rely on or benefit from the increased use of shared technology, infrastructure and services, internet-based products and services, new payment methods, big data, the internet of things, and social distribution and media. These companies may develop, produce, or enable cloud computing and cybersecurity, e-commerce, big data, artificial intelligence, mobile technology, the internet of things, social platforms, blockchain, and P2P. 

For more news, information, and strategy, visit the Disruptive Technology Channel.