Wood Sells Tesla and Shopify, Invests in Promising Growth Stock
【Summary】Cathie Wood, CEO of Ark Invest, has sold shares of Tesla and Shopify from the firm's ETFs and used the funds to invest in Archer Aviation, a maker of flying vehicles. Wood still has confidence in Tesla and Shopify, which remain significant holdings in Ark's ETFs. Archer Aviation, a pre-revenue company, has seen its stock price rise significantly and has secured substantial investment funding.
Ark Invest CEO Cathie Wood has been trimming holdings in Tesla and Shopify from the investment firm's various exchange-traded funds (ETFs). On Aug. 15, Ark Invest sold 1,884 shares of Tesla, followed by the sale of 182,314 shares of Shopify on Aug. 16.
Interestingly, the funds from these sales are being used to invest in a potentially explosive, high-risk growth stock.
On Aug. 16, Wood's company purchased approximately $16 million worth of Archer Aviation shares for its Ark Innovation ETF. Archer is a maker of flying vehicles, specifically electric vehicle takeoff and landing (eVTOL) aircraft, and its business is still in a pre-revenue state.
Wood's recent stock moves indicate that she is still bullish on Tesla and Shopify. While she has sold some of their shares, Tesla remains the largest stock holding in Ark Innovation ETF, accounting for 10.1% of the total portfolio weight. Shopify accounts for approximately 9.6% of the total portfolio weight in the Ark Fintech Innovation ETF.
Tesla also accounts for 6% of the total portfolio weight in the Ark Next Generation Internet ETF, while Shopify represents 4.4% of the equity weight in the portfolio. The sales of Tesla and Shopify by Ark Invest were relatively small compared to their overall holdings.
It is likely that these sales were made to free up funds for other potentially explosive investments, such as Archer Aviation. Wood appears to be increasingly excited about Archer Aviation and its potential.
Archer Aviation went public in 2021 through a merger with a special purpose acquisition company (SPAC). Although the stock has experienced volatility, its share price has increased by approximately 220% year to date.
Archer is a pioneer in the flying electric vehicle industry, and Wood believes it has the potential to be a long-term winner. Ark Invest has previously invested in the company, and Archer recently secured $215 million in new investment funding from Ark, Stellantis, Boeing, and United Airlines.
The urban air-mobility market is projected to be worth $29 billion annually in 2023 and over $1 trillion by 2040, according to estimates from Morgan Stanley. Archer aims to achieve FAA certification and begin commercial operations in 2025, and it has already received the FAA special airworthiness certificate for its Midnight vehicle.
While there is promise in Archer's outlook, it is important to note that it is a highly speculative investment. Wood, known for her high-risk, high-reward growth plays, has not made a significant bet on the company yet.
Even with the recent purchases, Archer Aviation represents a relatively small portion of Ark's flagship growth fund. The Ark Innovation ETF currently holds Archer stock worth approximately $26.1 million, accounting for about 0.4% of the fund's total stock holdings.
-
Electric Nissan Juke: A Sneak Peek at the Future
-
Electric cars set to become more affordable
-
Major creditor in talks to acquire Volta Trucks
-
Chinese EV maker's valuation close to Tesla
-
EVs' Limited Success in the U.S., Excluding Teslas
-
Toyota's Dedication to Quality Shines in Century Bolt Tightening Process
-
Tragic Accident: Bentley's Speed Questioned in Niagara Falls Deaths
-
Accelerating Car Development with Mazda-backed AI Firm
- Electric Nissan Juke And Qashqai Get 'Hyper' Concept Inspiration
- Toyota's Dedication to Quality Shines in Century Bolt Tightening Process
- Tesla factory in Texas plagued by explosions, injuries, and robot mishaps
- 2024 Mitsubishi Triton price and specs: Increased cost
- Lancia Replica Features Alfa Romeo V6 and Manual Transmission
- Mitsubishi's Minivan EV with 112 Miles of Range to Debut in Japan
- Futuristic people mover revealed by Chinese electric-car start-up
- Car tax revenue boost for Treasury
- EV Batteries Ideal for Storing Solar Energy
- BMW Reintroduces XM Label as High-Powered Safety Car