Cathie Woods: Bold Prediction for Tesla

Recently the renowned stock picker and Tesla (TSLA) bull made a new price prediction on the automaker, which sounds just as crazy as the last time she made a wild prediction, but the first prediction has come true, and then some.

Cathie Woods is the Founder and lead stock picker for the Ark Invest family of exchange-traded funds. Woods initially started Ark Invest in 2014 and made heavy bets on technology companies.

She became a household name when her original $2,000 price target on Tesla, when the stock was trading for around $300 per share, came true on a split-adjusted basis.

When Cathie initially made her case for Tesla at $2,000, people thought she had lost her mind. They couldn't understand how she arrived at that valuation and why she was so confident in that prediction.

Which, by the way, she was, considering she invested millions in Tesla before it went on its run higher.

Those investments in several different Ark Invest ETFs helped propel several Ark ETFs into the top ten best-performing ETFs for several years in a row.

Cathie is at it again, possibly giving investors a second chance to catch lightning in a bottle.

Cathie Woods Ark Invest owns a little more than $850 million worth of Tesla stock (stock price is currently around $170 per share). She believes the stock price can go to at least $1,400 per share by 2027.

That price is her bear case scenario, with a bull case scenario of $2,500 and a base case price of $2,000 per share. Those figures would represent an eight, eleven, and fourteen-fold return from today's price.

Furthermore, the base-case price of $2,000 per share would give Tesla a market capitalization of $6.3 trillion. For context, two of the largest companies in the world Apple (AAPL) and Microsoft (MSFT), have market caps of $2.7 trillion and $2.2 billion. At $6.3 trillion, Tesla would be worth more than both of them combined. Continue reading "Cathie Woods: Bold Prediction for Tesla"

ARKK Fund's Wild Ride

After its first year of trading in 2015, the ARK Innovation ETF (ARKK) increased by 87.38% in 2017!

The fund produced a gain of 3.76% in 2015 and a small loss of 1.96% in 2016, all of a sudden, the boom in 2017! 2017 was followed up by another modest gain of just 3.58% in 2018. But in 2019, ARKK made 35.73%.

Then, despite 2020 being the year we will all remember the Covid-19 pandemic beginning in the United States and the stock markets crashing when the country shut down in an attempt to slow the spread of the deadly virus, ARKK showed its investors a return of 152.52%.

Unfortunately, in 2021, the fund did not perform as well, actually posting a loss of 23.35% for the year. And while we still have a few months left in 2022, year-to-date ARKK is down 49.17%.

Even though 2021 and 2022 have not been good to ARKK, the fund is still up an annualized 16% over the last five years. That is due to the incredible performance it experienced in 2019 and 2020.

Since its inception, some would say ARKK has been somewhat volatile. That is primarily due to the fund's lead investor, Cathie Woods, and how she takes what many would consider 'very long-shot bets.' Woods often invests in unproven technologies and companies trying to develop cutting-edge technology.

Cathie Woods believes the future of technology will, if it already hasn't, truly change the world. By looking at the performance of not just her flagship fund, ARKK, her other funds all focus on the same idea; finding innovative companies. But that comes with risk.

And Cathie Woods' ARK funds have a lot of risk in them. If the companies Woods invests in don't perform well, Woods funds take big hits. But, the other side of this coin is also at play. Continue reading "ARKK Fund's Wild Ride"

The Anti-ARK (or Anti-Cathie Woods) ETF

Over the past few years, Cathie Woods has made a name for herself. It started with her ARK Invest flagship Exchange Traded Fund the ARK Innovation ETF (ARKK), which returned an astonishing 45% annually for five years straight. Her other Ark Invest funds had similar success, and regularly these funds would rank in the top 10 of the best performing non-leveraged equity ETFs investors could buy.

Cathie became more of a household name when she not only went on CNBC years ago and said she thought Tesla was a $2,000 stock (this was prior to Tesla splitting), and she was proven correct. When she made this claim, her Ark funds were doing well, but most investment insiders thought she was crazy and that her prediction for Tesla would never come true. So, when she was proven correct, everyone started watching what she was doing and either trying to copy her or attempting to bet against her.

Copying what she was doing was and still is easy since her fund publishes the daily trades they made during the previous session. Not only do they publish the stocks they sold and bought, but how many shares of each company they traded. For a time, the morning show on CNBC would review her previous days' trades and discuss whether or not they agreed with what her funds were buying and selling.

Some would say that Cathie's luck has now run out because while for years she had some of the top-performing ETFs, 2021 has not been so kind to her. Continue reading "The Anti-ARK (or Anti-Cathie Woods) ETF"

ARK Space ETF: The Good And The Bad

After making a call a few years ago, Cathie Woods has gone from “crazy lady” that Tesla would be worth more than $3,000 per share to investing superstar after her prediction came true in just a few years. Now she is entering into a whole new, truly unexplored realm with her newest ARK Invest Fund, the ARK Space Exploration & Innovation ETF (ARKX).

The first time I heard of this ETF, I was super interested in the idea that I could invest in the hot space exploration companies in a nicely bundled package without having to cherry-pick the winners and losers of this industry during its infancy. See, with most new or newer industries, a lot of the early companies don’t make it, while just a few of those first companies in the industry are the ones that go on and dominate the industry for years to come. But, how do you know when things are just getting started which company is going to go bust and which is going to be a big winner?

So, industry-specific Exchange Traded Funds help solve this problem because they allow you to invest in all the companies operating in that industry while spreading out the risk. And since space exploration, from a private business side, is still very young, this is the perfect way to play the Space industry. Continue reading "ARK Space ETF: The Good And The Bad"