ARK Invest and CEO Cathie Wood have once again bought the dip on firms the company believes have long term potential to be real innovators, adding shares from Tesla (TSLA), Coinbase (COIN), and Verve Therapeutics (VERV) on Wednesday. The moves represent continued contrarian views not only on the stocks themselves, but also on the market overall, with contrarian ETFs like the ARK Autonomous Tech & Robotics ETF (ARKQ), the ARK Next Generation Internet ETF (ARKW), and the ARK Genomic Revolution ETF (ARKG).
Just as CEO Elon Musk sold off another 22 million TSLA shares, ARKQ stepped in to buy just over 10,000 shares on Wednesday. The strategy move, which charges 75 basis points, marks just the latest TSLA buy from Wood and ARKQ, which made two TSLA pickups in November, looking for a continued buy low opportunity in the potential of its electric vehicles.
TSLA has seen its price impacted by Musk’s purchase and operation of Twitter, with shareholders concerned by the prospect of the loss of ad revenue if firms decide to stop advertising in a more loosely moderated forum. Still, Wood recently reiterated that she was not worried about Musk’s leadership at TSLA, though Goldman Sachs did recently slash its price target for the firm.
Meanwhile, the ongoing “crypto winter” has entered a new, difficult phase in the wake of the FTX affair. With crypto platform Binance possibly facing new scrutiny as well, investors may have reason to be skeptical of the broader world of digital assets. Still, Wood and ARK have doubled down on COIN as well with a new 27,000 share buy by ARKW.
ARKW, which charges 88 basis points and invests in companies poised to benefit from advances like AI or big data in addition to financial technology, also added COIN stock last month. COIN represents another buy low opportunity for those who believe that there is still potential in crypto and digital assets on the blockchain, with COIN avoiding direct exposure to FTX as of last month.
ARKG, the firm’s genomics-focused ETF, bought almost 9,000 shares of VERV this week as well. The company is developing a gene-editing tool that works inside the body, with its main function currently targeting high cholesterol.
While VERV has not yet offered investors serious revenues, its summer deal with Vertex Pharmaceuticals (VRTX) may position it to continue its research. ARKG, which charges 75 basis points, may benefit from the firm’s continued focus on biotech’s crown jewel of genetics.
The contrarian ETFs present an opportunity to follow ARK’s disruptive innovation investment thesis, with all three actively managed. While it hasn’t been the easiest year in flows or performance for technology-focused strategies, investors looking for a different take on the market may want to keep an eye on ARK’s ongoing contrarian buys of frontline tech companies.
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