Bloomberg
Cathie Wood Funds Hit by Biggest Investor Outflow on Record
(Bloomberg) — Three of Cathie Wood’s exchange-traded funds posted their largest outflows on record after a selloff engulfed some of the star money manager’s biggest bets.Investors pulled $465 million from Ark Investment Management’s flagship product, the ARK Innovation ETF (ticker ARKK), in the latest trading session for which flow figures are available, according to data compiled by Bloomberg.They also withdrew $202 million from the ARK Genomic Revolution ETF (ARKG) and $119 million from the ARK Next Generation Internet ETF (ARKW).While those flows are a fraction of Ark’s assets under management — its ETFs held more than $60 billion as of last week — the exodus is unprecedented in the short history of the firm, which Wood founded in 2014. The outflow from ARKK was more than treble its previous record.Wood’s ETFs have been battered by a selloff in U.S. tech shares that ensnared their largest and most famous bet, Tesla Inc. Rising bond yields and the prospect of returning inflation are rattling investors and spurring caution about the priciest-looking corners of the stock market.Wood told Bloomberg Radio on Tuesday she welcomed the correction, and that she was using it to buy more shares of the electric carmaker.Read more: Cathie Wood Buys the 13% Dip in Tesla as ARKK Slips Again She also talked up Bitcoin, another of her major investments. By Wednesday morning in New York, the largest cryptocurrency had arrested a two-day slide and climbed back above $50,000. Tesla was up around 3.5% in early trading, stabilizing after four days of declines.Meanwhile, futures on the Nasdaq 100 Index edged higher after the underlying gauge erased most of a 3.5% slide on Tuesday. All that could mean Ark’s dramatic outflows prove temporary.Against that backdrop, ARKK also nudged higher in the pre-market. The fund posted its worst performance since September in the two days through Tuesday, with the decline and the outflows cutting assets by about $3 billion from the end of last week to $25.2 billion, the data show.After its stellar run of inflows and triple-digit returns in 2020, bearish bets have been growing in the ETF. Short interest has risen to more than 3% of the available shares in the fund, according to data from IHS Markit Ltd., the highest on record.(Updates with Bitcoin, latest pricing, tech share selloff details.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
Add Comment