Wall Street and Cathie Wood – the wave-making investor and disruptor

Wood has got the name as an infamous personality among the Wall Street investors. Some would call her the disruptor. She openly discusses strategies and investment plans on her YouTube channel, as well as on numerous media outlets on the Internet.

 Of course, she’s not alone, as she’s promoting her company, Ark Invest. She’s been quite successful, as she gathered a growing legion of supporters and followers. A lot of those are genuinely happy with Ark Invest’s relentless and ambitious focus on the future filled with tech innovations. They are believed to be the ones who will take part in creating the new world.

Wood is known for her lack of complexes – not that long ago she was giving Elon Musk advice via Twitter responses. And although this may be impressive for some, a lot of already established firms deny Wood’s successes. More orthodox ones resent the fast-growing and expensive tech companies, and the somewhat controversial figure of Cathie Wood isn’t helping. She is indeed the person that you either love or hate. Nothing in between.

Ark’s ETFs generated huge returns (over 100% by all five of them) – and with that in mind, nobody should ignore Wood anymore.

Who exactly is Cathy Wood?

Wood’s been present in New York even before she founded Ark Invest. In 2001, she finished a successful 18-year period of work at Jennison Associates and had already co-established a hedge fund. Wood joined AllianceBernstein firm, where she became the Chief Investment Officer and managed $5 billion worth of assets in the Global Thematic Strategies sector.

It was back there, where she first pitched her idea of creating an ETF that would be based on the (disruptive) innovations. It happened after the financial crash of 2008 when Wood was being heavily criticized for poor performance during it. This idea was indeed fresh and revolutionary, and by most considered too big of a risk to be implemented. Wood left AllianceBernstein, and have founded Ark Invest in 2014. Her only motivation was to focus on her disruptive idea.

Why should Ark Invest be considered innovative?

Ren Leggi, who works as Ark’s Client Portfolio Manager, distinguishes three main characteristics. According to him, in order to be innovative, the company must be built on technologies that aren’t reserved for one sector only. The innovations must be cutting through different industries, geographies, and could potentially be applied to different markets (could there be a better example than electric vehicles?).

There needs to be clear evidence of a decline of a cost curve. It proves one thing – that the cost of certain goods’ manufacturing will become gradually cheaper – therefore making it more profitable, should the demand be as high as predicted. Ark Invest presents an example from 2007 – the decline of costs of lithium-ion batteries. This case shows that when the demand reaches a certain point, the costs decline at an accelerating speed. This, and the growth of production rate, meant that the product’s usage expanded across all markets, as it was used in a wide range of products and services.

The third point that Leggi makes, is that innovative companies need to become a platform for new technologies to be developed on. It should work as a kind of springboard for future growth and development opportunities. In theory, this grants them limitless amounts of potential users too.

Ark invests in the technologies, that (as they believe) will be the base of the future global economy. If they are correct, the awards for such predictions will be enormously high. We’re speaking of Artificial Intelligence and blockchain technology. Their potential growth, should their actions be responsible and well-thought, is really exponential.

To read more about Ark’s investors, and find out why Wood should watch Tesla carefully, visit Harry Clynch’s fascinating piece on the topic that was published on the Disruption Banking website. Clynch takes a closer look at Ark’s structures, actions, and prospects. To access it for free, use the link: