Cathie Wood is the founder, Chief Executive Officer, and Chief Investment Officer of Ark Invest an investment management firm. And while I admire her commitment to investing in the technology of tomorrow, her investment discipline needs some tweaking.
Cathie is invested in several companies my team and I believe will be long-term winners. Companies like NVIDIA, Shopify, Zoom, and Twilio. But repeatedly adding to a position while the price is in a steep downtrend doesn’t make a ton of sense.
For example, after buying hundreds of thousands of shares of Coinbase Global from $234 all the way down to the low-$50s, Cathie turned around and sold 1.133 million shares on July 26, 2022, around $54. She then turned around and purchased more than 207,000 shares on November 9, 2022, in the mid-to-high-$40s and another 255,000 shares on November 18, in the mid-$40s.
If Cathie believes in COIN, a more logical approach would be to wait for the stock to stop falling, give it time to build a base, and begin buying the stock on strength once the bear trend is over.
Look, I’m the first to admit that investing in innovative technology is both risky and highly volatile. If you’re going to invest in companies developing tomorrow’s technology, you must do so cautiously and with an appreciation for how extreme highs and lows will be. In Cathie’s case, I love some of her investment choices, but investment execution needs some refining. – James A.
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Thread: The Ark is Sinking
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23-11-2022, 12:46 PM #1
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The Ark is Sinking
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