RIP Cathie Woods
Could someone explain what's her claim to fame and why's she failing so spectacularly? Am I correct in thinking she's blending an ETF (passive) and sector selection (active) approach, which makes her 'special'? Plus the retail appeal.
So she's bleeding like shit cuz she's going atypical WSB degenerate diamond-hands on 'disruptive industries' - Tesla, crypto etc? Lol does she actually believe in that, unironically? Even after FTX. I always read her statements and she offers zero unique insights on her diamond hands strategy.
What made her so special in the first place. Also, is it only the innovation ARKK fund that's shit, or is the entire ARK shit
She has had a very solid career up until founding ARKK. Yes you're correct in terms of adding an active approach to an ETF structure.
Personally, I think she has drank too much of her own Kool-Aid at this point and is just completely off the rails.
I absolutely agree that she drank her own Kool-Aid and has continued to double or triple down on it.
One part of her issue is that she was an incredible marketing machine - from her website to her podcasts, it's all really well down. Good content, really attractive marketing materials - you felt cool buying her funds. Your friends bought her funds. It 'sounds' sexy - genomic revolution, innovation, etc. She also sold big, disruptive ideas that captivate people. Moonshots if you will. Anyone who looked at her Tesla valuation model that got put out - knowing it wasn't 'hers' literally speaking - had to stop and go 'wait, what?'. But it didn't matter because the proof was in the price of Tesla and her funds. The publicity she got didn't help her IMO, as it created a halo effect and encouraged a lot of money in the door that may not have been able to properly assess or manage the risks embedded in her funds.
Add in the structural issues - you have an ETF that has a lot of retail money flowing in and out. Layer that with pretty significant bets on similar companies across her funds, all of which are high beta, high growth, extremely sensitive to an adverse rate cycle, and widely held outside of her (or because of her - take your pick). Then add in the reality that many of her names were not particularly liquid, so when flows start hitting you it can have a practical effect of causing you to sell what you have liquid to hold your positions - or worse, sell good ideas to fund bad ones. I don't follow her funds as closely anymore, so this might have been mitigated.
All that said - what do people expect? Genomic revolution funds (or whatever they are) aren't exactly designed to hold blue chip value and treasuries - she is getting people exposure to what she said she would. Don't put all your money in TQQQ call options or ARKK if you aren't will to bear that risk.
Part of her recent claim to fame was that she was “early” in the major tech/bull market run of 2020/2021. CNBC had her on national television basically every other week when Bitcoin hit a new all time high or when Tesla started going 10x in like a year or whatever basically she kept saying they would 10x from even the levels they were then (like Bitcoin $100k or a million or whatever and Tesla robocars taking over all the roads and then the battery pack business being another trillion dollar business on top of that from what I remember she would say). Since then it seems like all of the excess gains have gone away and her fund may be currently underperforming the s&P500 on a 10 year basis basically. So now she is no longer so in favor or on CNBC as much potentially
People bought into the 'wow a great female investor' hype way too much because they wanted to believe it...the same thing Elizabeth Holmes of Theranos preyed on. Though the latter was fraudulent, the former is just incompetent
ah yea well true I suspected that but steered away from mentioning these controversial gender issues
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