Cathie Wood and her Ark Invest empire have faced an up and down 2023 and now, the famed stock picker is adjusting her strategy when it comes to the world's second largest economy.
This week, Weed revealed that her Ark Innovation ETF (ARKK) -), and its nearly $9 billion in assets under management, has exited stocks that generate revenue from China.
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“As we always do during bear markets, we concentrated our strategies towards our highest conviction names and the Chinese names, in particular, came out one by one as we were concentrating so that now, at least in the flagship strategy, we do have no exposure to China,” Wood said in a webinar, according to CNBC.
Instead, Wood says Ark Innovation would focus on some of her favorite companies like Tesla (TSLA) -), Coinbase (COIN) -), Roku (ROKU) -) and Zoom (ZM) -).
ARKK had owned tech giants like Tencent TCEHY and KE Holdings BEKE as Wood's exposure to China and other emerging markets reached 25% of her portfolio in 2020.
However, changing times calls for a new strategy.
“We were looking at the fiscal and monetary policy responses around the world and were impressed with China’s restraint. They were not throwing money at the problem. They were very disciplined in terms of their monetary and fiscal policy responses,” Wood said.
“It was responsible for roughly 15 years of double-digit real GDP growth ... and growth like that can cover a lot of sins,” Wood said. “And those sins usually involve debt, and importantly in the property space, we do believe that China is facing its day of reckoning in this regard.”
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