The flagship strategy of Cathie Wood is about to experience one of its best months ever. The ARK Innovation ETF has returned nearly 22% since the beginning of January and is set for its third best month ever. One week into trading, the fund could eclipse the 26% and 24% monthly returns achieved in 2020, year in which it made its appearance on the global investment scene.
The product is benefiting from a positive mood in global markets as investors are betting that high inflation is now behind us is that Jerome Powell’s Fed is ready to ease the pace of rate hikes.
The relentless monetary tightening that has driven up the cost of borrowing has hit ETFs like ARK Innovation ETF and various stocks on which the fund is betting.
But since the beginning of 2023, really the Nasdaq index posted substantial gainsin the wake of speculation that Jerome Powell’s Fed it will be less aggressivein its path of anti-inflation rate hikes.
And so Exact Sciences Corp., ARK Innovation ETF’s largest holding, witnessed a jump in prices of around 37%.
The beleaguered Tesla, now the third largest holding in the portfolio, jumped about 17%..
Of course, Cathie Wood still has to wait before officially toasting the comeback of its ETFs.
In particular, the ARKK flagship ETF travels at a value that remains below the all-time highs tested at the beginning of 2021 by more than -75%.
According to data compiled by Bloomberg, the ETF fund itself has attracted a net flow of $1.5 billion in the past year.
Star of the world of finance, Cathie Wood has repeatedly confirmed herself as a contrarian, especially during 2022, the year in which the shares she bet on were literally overwhelmed by the sell-offs.