Cathie Wood, head of Ark Investment Management, often adjusts her top positions, adding to a holding when the stock falls and selling when it rises, even if her long-term vision hasn’t changed.
That strategy has paid off in the recent market rally, with her funds capturing much of the upside in fast-growing tech names.
Recently, Wood has been taking some profits from one of her strongest AI performers.
Wood’s funds have experienced a volatile ride this year, swinging from sharp losses to strong gains.
In January and February, the Ark funds rallied as investors bet on the Trump administration’s potential deregulation that could benefit Wood’s tech bets. But they fell sharply in March and April, underperforming the market as top tech holdings slid amid growing concerns over the macroeconomy and trade policies.
Now, the Ark’s funds are showing solid performance again. As of Oct. 21, the flagship Ark Innovation ETF ARKK is up 54% year-to-date, far outpacing the S&P 500’s 14.5% gain.
Wood’s remarkable return of 153% in 2020 helped build her reputation and attract loyal investors. Her strategy can lead to sharp gains during bull markets but also painful losses, like in 2022, when ARKK dropped more than 60%.
Those swings have weighed on her long-term results. As of Oct. 20, the Ark Innovation ETF has delivered a five-year annualized return of negative 1.8%, while the S&P 500 has an annualized return of 16.1% over the same period.
Image source: Fallon/AFP via Getty Images
Wood’s investment strategy is straightforward: Her Ark ETFs typically buy shares in emerging high-tech companies in fields such as artificial intelligence, blockchain, biomedical technology, and robotics.
She thinks these companies have the potential to reshape industries and bring outsized long-term returns, but their volatility leads to big fluctuations in Ark funds’ values.
Related: Cathie Wood’s net worth: The Ark Invest CEO’s wealth & income
Over the 10 years ending in 2024, the Ark Innovation ETF wiped out $7 billion in investor wealth, according to an analysis by Morningstar’s analyst Amy Arnott. That made it the third-biggest wealth destroyer among mutual funds and ETFs in Arnott’s ranking.
Still, Wood has been bullish on the market. In a letter to investors published in late April, she dismissed predictions of a recession dragging into 2026 and struck an optimistic tone for tech stocks.
More Tech Stocks:
“During the current turbulent transition in the U.S., we think consumers and businesses are likely to accelerate the shift to technologically enabled innovation platforms, including artificial intelligence, robotics, energy storage, blockchain technology, and multiomics sequencing,” she said.
Not all investors share this optimism. In the five days through Oct. 20, the Ark Innovation ETF drew about $1.44 billion in net outflows, according to ETF research firm VettaFi.
Wood has been cashing in on Palantir (PLTR) recently. On Oct. 20, the Ark funds sold 20,208 Palantir shares, valued at about $3.7 million. Between Oct. 10 and 15, she also sold 23,794 shares for around $4.3 million, bringing total sales to roughly $8 million over the past 10 days.
Palantir has been riding high this year, with the stock up 140% year-to-date and hitting an all-time high closing price of 187.05 on Oct. 2, 2025.
Related: Palantir rival quietly builds a big business
The Colorado-based company provides AI-driven data analytics software to the U.S. government, military, and commercial clients. Last year, the stock soared 340% as demand for AI infrastructure surged across sectors.
The tech company is set to announce its fiscal third-quarter 2025 financial results on Monday, Nov. 3. In August, the company posted milestone-hitting revenue of $1 billion, up 48% year-over-year. Palantir also raised its full-year guidance to between $4.142 billion and $4.150 billion, up from a prior range of $3.89 billion to $3.90 billion.
Wood said in February that she’s doubling down on software, with Palantir being one of her top picks. Her recent selling might just be a move to take profits after the stock’s strong run rather than a shift in conviction.
“Palantir is a very expensive stock, but there’s nothing like it in the software space,” Wood said in a February CNBC interview. “It is, we believe, going to dominate the biggest part of the tech stack when it comes to AI. And that’s the platform as a service part of the stack.”
Palantir remains a key position for Wood after recent sales. The stock is now the ninth biggest holding of the ARK Innovation ETF, accounting for 4.09%.
Despite selling Palantir, Wood’s recent moves include selling shares of Roblox (RBLX), Shopify (SHOP), Rocket Lab (RKLB), and buying Pony AI (PONY) and Qualcomm (QCOM).
Related: Analysts update Broadcom stock forecast
This story was originally reported by TheStreet on Oct 22, 2025, where it first appeared in the Investing section. Add TheStreet as a Preferred Source by clicking here.