jakiro
Author: Andy Sewer
“Miss Wood” Cathie Wood is not the kind of aggressive or boasting person, but she does have a strong personal opinion and is willing to share her views with others and convince people of her investment theory-Technologies such as artificial intelligence, robotics, energy storage, DNA sequencing and blockchain will change our world – it is her passion, and even her mission.
Wood is the founder, CEO and chief investment officer of ARK Invest, which has an asset management scale of US$30 billion.I interviewed her this week at the Global Sports Leaders Conference in Keva, South Carolina.
Wood talked about topics such as Tesla, Musk and X, cryptocurrency, Nvidia and artificial intelligence, and her beliefs, and she also mentioned the life-saving straw that a billionaire investor once threw to her.
Wood talks about Tesla and Musk
Earlier this week, electric car maker Tesla released lower-than-expected delivery data, and its share price fell sharply.I pointed out to Wood that some analysts think Tesla’s good days are over, and Wood said she doesn’t think so.Wood is a big investor in Tesla and she believes that Tesla’s stock price can rise by more than 1,000%.
“We totally disagree with that,” Wood said, who then spoke about his opinion on Tesla’s self-driving taxi business.Wood said: “I heard someone say this morning, ‘Tesla has the ability to launch self-driving taxis, but it will take years to come’, and we don’t think so, given the breakthrough brought by artificial intelligence, we think self-driving rentalsThe opportunity for a car is coming soon.”
Wood believes that the “gross profit margin of the autonomous taxi business is between 80% and 85%, which is like software as a service. Currently, the gross profit margin of the electric vehicle business is between 15% and 17%, and we believe that the gross profit margin of the business isInterest rates can reach 25% to 30%.
Wood continued: “Most analysts classify Tesla as a car company, but it’s not a car company at all, but a robotics, energy storage and artificial intelligence company that will be reflected in its profit margins.”
“The automotive industry – like Ford and GM – is moving away from electric cars, which is a big mistake because the only way they make a profit is to expand the size of electric cars, so they are saying they are giving up the market to TesSla, with Tesla cars going to the range of $20,000 to $25,000 in five years (currently average prices are $30,000 to $45,000), other auto companies will be eliminated.”
I asked Wood if he was buying Tesla stock now.
“Yes, we disclose positions and trading at the end of each trading day,” she said.
Wood later told me that she sold some stocks when Tesla’s stock price was approaching its peak a few years ago, but she is buying now, “Buy low and sell high, right?” she said.
I asked Wood if he was worried about Musk’s behavior and the changes he had taken place.
Wood said: “Oh no, he’s not any different from the past. Honestly, we’ve seen him a lot and I think he’s focusing heavily on the ‘barriers of entry’ for his company and how to move technology forward.We are learning more about what he is going to do, and I think he is changing our world and saving humanity is an extremely important thing for him.We should see what he did, not what he said.”
What Wood said may make sense. Maybe people are too concerned about the big and small storms that Musk has caused after taking over X, and forget that he is still full of enthusiasm for building Tesla.
Wood’s view of X is different from others, she said: “Social media is constantly evolving and changing, X is the most important platform for us, and I think it is becoming a platform for knowledge workers. We are integrating all of thisThe innovation community, they like our research, support us, unlike some people in the financial market who think we are totally crazy.”
Wood talks about Nvidia
Nvidia is another well-known company that Wood closely followed. She bought Nvidia stocks very early, but sold them before the stock price soared recently, and I asked her why she wanted to sell them.
Wood said: “People say we sold too early, and every time I see someone saying this, I find it interesting. When Ark was founded 10 years ago, Nvidia’s stock price was $4, and Nvidia was just a PC gaming chip company at that time, After our initial research on the company, we thought that GPUs would become the brains of robots and autonomous cars, so we classified it as an AI chip company very early on,Ark Flagship Fund has been holding this stock during the period when Nvidia’s stock price rose from $4 to $400, which is quite good that it has risen by 100 times.The stock price is now $900.”
Wood believes that Nvidia “current stock price digests the expectation that all AI projects will deliver 100% on their promises,” she believes that this is a bit too optimistic. “All related projects take time, and Nvidia remains the most important AI chip company,” she says.It is far ahead, but I think Nvidia will face inventory issues and will face a lot of competition in the future.”
Wood’s largest holding is Coinbase
People have mixed praises and criticisms about Wood’s “return” and I pointed this to her, and she admits it is indeed the case.
“Since its founding, the flagship fund ARK Innovation has a compound annual return of 11%, and yes, we have experienced booms and busts, and our flagship fund has risen by nearly 400 in 2021 in 11 months.%.
Wood said investors have become more conservative after flagship funds fell sharply along with many rising stocks and funds.
“Now investors are flocking to benchmark indexes, such as the S&P 500 and the Nasdaq. The Nasdaq is different from the Nasdaq I saw in the 1980s and 1990s.The index has become a very mature index. I often say that our holdings are ‘new Nasdaq’, but I actually like the psychological factors in it because I prefer to be suspicious, afraid, and notI am willing to invest when I believe, and that’s what we are doing.”
Wood’s biggest holding is Coinbase, not Tesla, which may be different from what some people think. She is a loyal believer in cryptocurrency, and Bitcoin accounts for more than 25% of her net assets.
“When the price of Bitcoin was $250, we provided our customers with Bitcoin exposure, and now the price is about $66,000, and we think the rise in Bitcoin has just begun, why do you say that? The global monetary system is usually divided by countryBitcoin has global, digital, decentralized and private attributes, and it separates governments and humans from this system.
My mentor (economist) Art Laffer is very excited about the possibility that we can return to the era of private money, to the era before the founding of the Federal Reserve.There is a guy who is currently — Fed Chairman Powell — who is swaying the market in his own way, and I think that’s crazy, and it’s been the case since Paul Volcker.
I think Bitcoin will be another currency, very useful in countries like Nigeria and Egypt, which depreciate 60% and 40% respectively.I just learned that the Indian rupee has depreciated by half in the past 10 years.”
I asked Wood what he thought about the fact that cryptocurrencies were used by drug dealers and criminals.
“When disruptive innovation comes, the question you’re talking about is the first reason why people say we don’t want to accept it, and the same was true when the Internet was first born.
As for the environmental problems caused by cryptocurrencies, you can look back at the early days of the Internet, and some people say, ‘Did you know the Internet uses as much electricity as this or that country?’ Now half of Bitcoin mining is regenerableEnergy-completed, Bitcoin mining can actually enter the utility ecosystem, placing Bitcoin mining machines in natural gas fields instead of burning or emissions.”
Wood talks about faith
I also talked to Wood about her beliefs.Her company name comes from the Ark of the Covenant, a wooden box that is said to contain the Ten Commandments.Much of Wood’s investments are based on technology and science. For her, is religious belief and science separate or influence each other?
“After the 2000 tech and telecom bubble and the financial crisis between 2008 and 2009, the investment community entered a hedge mode, which is one of the reasons I had to start my own company. People are currently investing more in the past than in the futureInvesting, if innovation platforms—robot technology, energy storage, artificial intelligence, blockchain technology and genetic sequencing—reversed the traditional world order, the companies they invested in would be at risk.”
“Go back to the question of faith you asked, we are investing in innovation, we have never seen such a period of abundant innovation, all innovation platforms are coming together, we will see huge changes, and 5 moreIn 10 years, you will not recognize the world.”
Wood ended the interview to billionaire Todd Boehly, founder and CEO of Eldridge Industries, whose company first lends money to Ark investment in late 2020 to prevent a private equity controlThe company exercised options to acquire a controlling stake in Wood Company and then bought the initial investment of the private equity firm the following year.
“We are very grateful to Todd Boley, if it weren’t for him, we would have died long ago,” Wood said.
