Last week I wrote about the fact that it's people who make the world of investing and finance so fascinating. So this week I want to write about Cathie Wood, probably the world's most exciting investor right now. Though if you are an investor in one of her ARK ETFs, particularly in the flagship Innovation exchange-traded fund (ETF), you may have found the ride a bit on the wild side.
First published in the Daily Maverick 168 weekly newspaper.
Last year, all five (now there are six) of Cathie Wood's actively managed funds gained more than 100%, with assets under management rising from $800-million in January 2018 to $50-billion at the end of 2020. But in March 2021 the markets got cold feet as concerns about inflation rose, accelerating a selloff of government bonds, pushing long-term yields higher and sparking a flight from high-growth stocks like those of technology companies. ARK's funds, most of which are dominated by shares of unprofitable, early-stage tech and biotech companies, were hit harder than most, falling as much as 30%, wiping out the gains of 2021 and provoking a storm of commentary.
Wood has developed a cult-like following on the back of wizardish stock...