“Given our expectations for growth in these new technologies, I think we’re going to see some spectacular returns.”
That was the chief executive officer of ARK Invest, Cathie Wood, who gave an optimistic view of returns for the next four years, in an interview with CNBC that published Monday.
Wood’s resilient view comes despite a 48% tumble over 12 months for her flagship ARK Innovation exchange-traded fund
which has lost 36% so far this year. Technology stocks have been leading the declines for markets in 2022, with the Russia-Ukraine war also dissuading investors from the perceived higher risk of some growth stocks.
“We’ve been in a terrible bear market for innovation,” said Wood. “However, if you look from the bottom of the coronavirus to that peak [of the Ark Innovation ETF] in February of ’21, we were up 358%.”
Wood said the war in Ukraine will likely lead to lots of “demand destruction and substitution into innovation,” given the surging prices of energy commodities especially. The price of U.S.
and European crude futures
surged over 8% on Monday amid reports the U.S. was considering a sanction on Russian oil.
She said the technology stocks ARK invests in will be the “future successes” that end up in the S&P 500
Read: This new competitor to the ARK Innovation ETF focuses on disruptive companies but aims to reduce volatility
The CEO said the firms inflows since Jan. 17 have been “significant,” and that many investors have been “averaging down,” which is a variation of dollar-cost averaging, buying more when an asset’s price is low.
Investors who do this, will often “quickly” see a strategy “come back above that average. And if we’re right, significantly above that average over five years,” she said.
Also read: ‘Cathie’s a boom or bust investor’—what Wood’s former boss says about the star fund manager