Cathie Wood’s Ark: a tech-driven bull market on steroids

Cathie Wood’s Ark: a tech-driven bull market on steroids

‘Queen of the bull market’ faces her toughest test

It’s a familiar phenomenon in the hedge fund industry. A manager records big gains in the early years on a small asset base. Investors chase the performance and assets pour in. Returns plummet.

A similar dynamic is unfolding at Cathie Wood’s Ark Invest, which has carved out a position as the poster child of the US stock market boom.

Through her ability to sell an investment narrative and a savvy adoption of social media, Wood has captivated the imaginations of legions of retail investors and billions of dollars by pitching aggressive bets on companies and technologies that she says will reshape the world, most famously Tesla.

Her successful bets on everything from genomics to bitcoin spawned a range of merchandise, including a T-shirt that depicts her riding a bull with the slogan: “The Queen of the bull market”. 

On the face of it, Wood’s results have been spectacular. The Ark Disruptive Innovation ETF — the company’s $17bn flagship fund that goes by the ticker ARKK and combines an exchange traded fund structure with an ability to pick stocks — has generated average annual gains of about 40 per cent over the past five years.

But more recently, its