Cathie Wood buys $43 million of megacap tech stock

Core Viewpoint - Cathie Wood's Ark Innovation ETF has faced significant challenges in early 2023, with a year-to-date decline of 9.58%, contrasting with a 1.27% gain in the S&P 500, highlighting the pressure on growth-focused tech stocks [1] Performance Summary - The Ark Innovation ETF delivered a remarkable 153% return in 2020 and a 35.49% return in the previous year, significantly outperforming the S&P 500, which returned 17.88% [2] - However, the ETF experienced a drastic decline of over 60% in 2022, illustrating the volatility associated with Wood's investment strategy [2] - As of February 6, the ETF has a five-year annualized return of -13.83%, while the S&P 500 has an annualized return of 13.92% during the same period [3] Investment Focus - Wood emphasizes investments in emerging high-tech sectors such as artificial intelligence, blockchain, biomedical technology, and robotics, believing these areas have substantial growth potential despite their inherent volatility [3] Wealth Impact - From 2014 to 2024, the Ark Innovation ETF has resulted in a loss of $7 billion in investor wealth, ranking as the third-largest wealth destroyer among mutual funds and ETFs according to Morningstar's analysis [4] Economic Outlook - In a letter dated January 15, Wood expressed optimism about the U.S. economy, predicting a sharp rebound in 2026, despite the current rolling recession [5] - Wood also dismissed concerns about an "AI bubble," asserting that a significant capital spending cycle is on the horizon, driven by advancements in various high-tech sectors [6] Investor Sentiment - Despite Wood's optimistic outlook, the Ark Innovation ETF experienced approximately $1.3 billion in net outflows over the 12 months leading up to February 5, indicating skepticism among investors [7]