Market Overview

Cathie Wood's Internet ETF Sells Some Tesla, Xilinx, Buys The Dip In Fastly

Cathie Wood's Internet ETF Sells Some Tesla, Xilinx, Buys The Dip In Fastly

One of the top-performing ETFs of the year bought the dip in Fastly Thursday.

What Happened: After pre-announcing third quarter earnings, Fastly Inc (NYSE: FSLY) saw shares drop 30% after-hours on Wednesday.

That dip led to the opportunity for the Ark Next Generation Internet ETF (NYSE: ARKW) to take a stake in the company.

The Ark Next Generation Internet ETF, led by Cathie Wood, bought 304,300 shares of Fastly. This represents a current stake of $27.3 million, around 1% of the fund’s assets.

The fund also bought small amounts of Palantir Technologies (NYSE: PLTR) and Zoom Video Communications (NASDAQ: ZM) on Thursday.

The ETF sold part of its stake in Tesla Inc (NASDAQ: TSLA), which is its top holding.

The Next Generation Internet ETF is known for its bullish take on the electric vehicle maker, and the stock has been the ETF's top holding for some time.

Over 26,000 shares of Tesla were sold, representing around $12 million. The sale represented around 0.4% of assets at the time.

Wood’s ETF also sold shares of (NYSE: CRM), Roku Inc (NASDAQ: ROKU), Square Inc (NYSE: SQ), Xilinx Inc (NASDAQ: XLNX) and LendingClub Corporation (NYSE: LC).

Related Link: Fastly Analysts Have More Questions Than Answers Amid Q3 Warning

Why It’s Important: Wood could be making a large bet that investors overreacted to the sharp drop in Fastly’s price on Thursday.

She also is taking some profits in Tesla, one of the best-performing stocks in the ETF, up over 430% in 2020.

The ETF is notably selling large amounts of Xilinx with three days of sales dating back to Sept. 30.

The Ark Next Generation Internet ETF is one of the best-performing ETFs in 2020 with a year-to-date return of 107%. The fund has returned 220% and 511% over the last three and five years, respectively.

Wood's ETF started buying shares in Chamath Palihapitiya's SPAC Social Capital Hedosophia Holdings Crop II (NYSE: IPOB) in late September. Shares are up 30% since her initial purchase. 

FSLY Price Action: Shares of Fastly were down 5.43% at $84.82 at last check Friday. 

Disclosure: Author is long shares of IPOB.


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