Legendary Money Manager Making a Comeback After Being DISGRACED By The Post Pandemic Economy

Cathie Wood, the founder and Chief Investment Officer of Ark Invest, rose to fame during pandemic days as the fund manager who made bold bets on pandemic winners such as Robinhood Markets, Inc. (HOOD), Coinbase Global (COIN), and Roku Inc. (ROKU). The seven active funds managed by Ark Invest brought in $30 billion in assets in 2020 and 2021, pushing the total assets under management of Ark Invest to an all-time high of around $50 billion in 2021. At the end of Q1 2024, the AUM had shrunk to just $13.5 billion on the back of a poor performance in 2022 that led to significant withdrawals. Ark Innovation ETF (ARKK), the flagship fund managed by Cathie Wood, gained 153% in 2020 but lost 24% of its value in 2021, followed by a staggering 67% decline in 2022. According to Morningstar data, Ark has wiped off $14 billion in wealth in the past decade, making it one of the worst-performing investment management companies during this period. However, Ark Innovation made a strong comeback in 2023, with the fund delivering a 68% gain. Here are a couple of the companies that contributed to their comeback.

Palantir

Palantir is a software company that develops data platforms to help businesses analyze large data sets. The company also offers AI-assisted analysis tools to improve the data analysis process, and its products are trusted by government agencies, including the U.S. Department of Defense and the U.S. Intelligence Community.

Palantir Technologies (PLTR), the ninth-largest holding of Ark Innovation ETF, continues to win the approval of Cathie Wood. Last month, the fund manager added almost 10,000 new Palantir shares to its Ark Space Exploration & Innovation ETF (ARKX). Earlier in May, Palantir was added to ARK Next Generation Internet ETF (ARKW) and Ark Fintech Innovation ETF (ARKF) as well. Ark Invest’s stake in Palantir exceeds $215 million through the Ark Innovation fund alone.

Palantir can be considered a frontrunner in integrating AI into data analysis. The company offers AI-powered data pipelines and a developer platform for clients to build custom AI apps.

Pager Duty

PagerDuty is a small-scale digital operations management company that offers real-time trigger alerts, smart notifications based on pre-defined schedules of company users, and collaboration tools to resolve incidents and track the progress of corporate tasks. The selling point of PagerDuty is the automated features offered by the platform to improve efficiency in managing the operations of a business.

After selling around 2 million PagerDuty, Inc. (PD) shares in Q1, Ark Invest is once again turning bullish on the company, as is evident from some of its recent transactions. In the last week of May, Ark Innovation fund bought 857,990 PagerDuty shares valued at $15.4 million, highlighting the fund manager’s changing view of the company. Earlier this week, Ark funds added another 43,192 PagerDuty shares as well.

Dilantha Desilva doe not have positions in any of the stocks mentioned in this article. Stocks.News does have a position in Robinhood Please see our disclosure page for more information.