Contrary to her own belief, Cathie Wood’s ARK Innovation (NYSE: ARKK) fund is the worst-performing for Q1 2022 according to financial analytics firm Morningstar. This follows after the fund 24% during 2021.
The flagship exchange-traded fund managed by Wood recorded a 29.9% loss during the quarter. The decline is mainly driven by tech stocks: Roku with a 44.18% fall, Zoom with a 33.65% fall, and Coinbase with a 29.80% fall — all of which are part of the fund’s top 5 holdings.
“The team’s aggressive-growth tech and healthcare picks have weighed heavily on returns,” Morningstar wrote in its report.
The firm also downgraded Wood’s ETF from ‘neutral’ to ‘negative’, citing the fund’s risk management, ability to navigate spaces it explores, and unconfident succession plan.
“Rather than gauge the portfolio’s aggregate risk exposures and simulate their effects during a variety of market conditions, the firm uses its past as a guide to the future and views risk almost exclusively through the lens of its bottom-up research into individual companies,” said Morningstar strategist Robby Greengold.
The polarizing fund manager made some head-scratching moves this quarter, including maintaining that oil prices will still collapse amidst the current rally, and pulling out shares in Palantir Technologies which led to a reported US$380 million in losses.
Information for this briefing was found via Morningstar, Yahoo News. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
