“We don’t think there are many managers in the public equity markets focused exclusively on disruptive innovation. And there should be, because there are massive opportunities evolving thanks to DNA sequencing, robotics, energy storage, artificial intelligence, and blockchain technology,” said Cathie Wood, the CEO of $75 billion asset manager Ark Invest during a fireside chat with executive editor Matt Schifrin at Forbes Wealth Summit on Wednesday. Besides expounding on her firm’s unique open source investing approach to seeking out innovation and disruption, Wood reiterated that worries over the current inflation “burst” are overblown and that it is precisely innovations like AI and robotics that will lead to productivity gains resulting in lower prices. Wood, who learned to recognize the causes of inflation studying under Reagan economist and USC professor Arthur Laffer in the late 1970s and early 1980s, said that another factor working against inflation are the quiet rise in inventories in people’s homes and on their driveways, in the form of Covid driven product hoarding and vehicle purchases.
“When companies who are probably double and triple ordering right now have filled the shelves, they’ll probably find that the consumer has enough,” said Wood.
Wood continues to be bullish on Tesla over other electric vehicle makers like GM and Ford, and believes the surge in oil prices will accelerate the shift away from gas-powered vehicles. “Gas-powered auto sales are down 30% since April, and we think there’s been a boom in electric vehicles. We have yet to get [their] prices below those of gas-powered cars, but thanks to the battery pack system cost declines, that should happen within the next couple of years.”
Wood explained why her firm continues to have a bullish outlook on cryptocurrencies, saying that regulation will not hamper the innovation that is taking place in NFTs, DeFi and the crypto space broadly.
When the superstar stock picker, whose flagship ARK Innovation ETF was up 153% in 2020, was asked for fresh recommendations beyond bitcoin and Tesla, she mentioned San Francisco’s Invitae Corp, an innovative genomics focused company, whose stock has suffered she believes by being lumped in with other diagnostic firms that the markets thinks are commodities.
“DNA sequencing and artificial intelligence are helping us identify mutations that we can eventually cure,” said Wood, “Artificial intelligence is key and Invitae is the furthest ahead.” Another stock she thinks isn’t getting enough credit is Zoom. “It’s not just a stay-at-home stock. It is becoming the fabric of the new enterprise communication layer of the tech stack, and there’s huge opportunity there.”
Earlier in the day, it was reported that Wood’s Ark ETFs had taken profits in Tesla and and purchased shares in Twitter, Coinbase and Robinhood.
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