Cathie Wood Loses Big Money On Every Stock She Owns

Even in a bad year, most investors at least have a few stocks they can brag about. Not so this year with Cathie Wood’s ARK Innovation ETF (ARKK).

The popular $7.1 billion-in-assets ETF currently holds 30 stock positions. And all of them are down this year. And not by a little. The average drop of the stocks in the ETF’s portfolio is nearly 60%, says an Investor’s Business Daily analysis of data from S&P Global Market Intelligence and MarketSmith.

ARK Innovation’s total loss this year is nearly 63%, says Morningstar Direct. That’s the largest drop among the more than 230 actively traded diversified ETFs. The S&P 500, in contrast, is down just 14.4% including dividends.

Struggles of one of the most popular actively managed ETFs this year underscore how quickly and dramatically the market changed this year. Many of the hottest stocks during the 2020 rally fueled by low interest rates are the biggest victims to rising rates.

“The more narrowly focused thematic ETFs suffered the most and perhaps are too concentrated for many shareholders,” said Todd Rosenbluth, head of research at VettaFi.

Biggest Holes In The ARK

ARK Innovation holds more than its fair share of catastrophes. Three stocks in its current portfolio are down 80% or more.

The ETF’s hardest hit stock is health care play Invitae (NVTA). The company that helps collect genetic data from patients has seen its stock crash more than 85% this year. The company reported disappointing quarterly results on Nov. 8, when it lost $1.27 a share, much worse than the 84 cents a share analysts expected. The stock’s drop is not a huge blow for ARK Innovation, as the position only accounts for less than 1% of the portfolio.

But the same can’t be said about two of ARK Innovation’s other two losing stocks: financial Coinbase (COIN) and technology stock Twilio (TWLO). Combined, the two stocks account for nearly 7% of ARK Innovation’s portfolio. And both companies, both led by the founders, are down more than 80% this year.