Cathie Wood Remains Bullish On AI Investments Despite Nvidia Stock Adjustments

Zinger Key Points
  • Cathie Wood emphasizes Ark's focus on emerging AI companies.
  • Ark increased Tesla holdings amid concerns of EV market slowdown.

Cathie Wood of Ark Investment Management remains confident in her firm's AI investments despite scaling back on Nvidia Corp NVDA shares prior to their significant rise last year.

Speaking at the Greenwich Economic Forum in Hong Kong, Wood emphasized Ark's continued exposure to emerging tech players, even though Nvidia remains a part of their specialized portfolios.

Wood noted that she initially invested in Nvidia in 2014 when the stock was approximately $4 per share, adjusted for splits.

The flagship ARK Innovation ETF held the stock until it surged to around $400 before selling off most of the position just before Nvidia's dramatic rally last year.

The AI-focused chipmaker has since seen its shares skyrocket, with a market value surpassing $3 trillion, overtaking Apple Inc. AAPL.

Wood explained that the decision to reduce Nvidia holdings was based on the belief that Nvidia's success would benefit other companies.

As a result, Ark began evaluating potential beneficiaries within the AI sector.

Despite Nvidia's ongoing prominence, Wood highlighted that the semiconductor industry is experiencing a pause as companies reassess their AI strategies.

During her remarks, Wood acknowledged that some companies anticipated to gain from AI advancements have yet to see the expected revenue boosts, with Salesforce Inc CRM being a notable example.

Also Read: Cathie Wood: El Salvador's Bitcoin And AI Push Could Grow Its GDP 10X In 5 Years

Meanwhile, she reaffirmed her strong stance on autonomous driving as the "biggest AI project on earth," reiterating her faith in Tesla Inc TSLA.

Ark increased its Tesla position in the first quarter despite concerns about slowing electric vehicle demand and competition from Chinese rival BYD Company BYDDY.

According to Ark's 2023 analysis, Tesla's share price is projected to reach $2,000 by 2027, with potential highs and lows ranging from $2,500 to $1,400.

Additionally, the Ark Venture Fund recently disclosed stakes in xAI, OpenAI, and Anthropic, signifying its commitment to AI innovation.

Wood gained widespread recognition during the pandemic for her bold investment calls, particularly in companies like Tesla, Zoom Video Communications Inc ZM, and Roku Inc ROKU.

Despite a 12% decline in the ARK Innovation ETF ARKK this year, largely due to Tesla's 30% drop, the fund had an impressive 68% gain last year.

Wood predicts significant interest rate cuts in 2024, driven by economic recessions and rate reductions in several countries.

Disclsaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

Cathie Wood Ark Photo courtesy Benzinga YouTube and Unsplash

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