<In a recent Public.com Town Hall, Wood explored innovation trends on the minds of retail investors, and shared ARK’s approach to investing in the future of disruptive ideas.
– Public.com Cathie Wood founded ARK with a focus on disruptive innovation. One of the early principles she applied was to shape ARK into what she calls a “sharing economy,” and to create an open and collaborative ecosystem of ideas.
For example, the annual ARK Big Ideas report and virtual event—freely accessible to the public—includes perspectives from ARK analysts, thought leaders, and Wood herself. The report focuses on themes like blockchain, autonomous driving, healthcare, and more.
In a recent Public.com Town Hall with retail investors, Wood explored key themes from Big Ideas 2022 and shared ARK’s approach to investing in disruptive innovation. The below is excerpted from Cathie Wood’s Public.com Town Hall, which can be viewed in full here.
On the meme stock revolution
Retail investing activity makes up nearly 30% of all stock market activity by some estimates—that’s about 3X the share that retail investors accounted for in 2019. Investors on Public.com were curious about Wood’s take on the retail revolution and meme stocks in particular.
Wood called the meme stock movement an “an interesting period of history that showcases smaller investors, in aggregate, can move markets meaningfully.” With that, she added that ARK is encouraged by companies that are opening up access to investing for “new, often underrepresented, participants.”
Wood called the meme stock movement an “an interesting period of history that showcases smaller investors, in aggregate, can move markets meaningfully.” With that, she added that ARK is encouraged by companies that are opening up access to investing for “new, often underrepresented, participants.”
In terms of ARK’s investments, Wood reiterated that the focus is on applying “top-down research to guide bottom-up stock selection,” which she notes is very different from investing in meme stocks.
Making sense of market volatility through a long-term lens
Given the recent volatility in the public markets, Public.com members wondered how Wood and the team at ARK navigate short-term fluctuations given ARK’s five-year horizon.
Wood reiterated ARK’s underlying thesis that innovation solves problems and is expected to transform human lives at an accelerated rate during the next five to ten years.
“We believe people should invest for the future, not for a short term gain,” she said, “I know it’s not easy at times and requires conviction, but that’s why we focus our research on the next five years, not the next quarter.
ARK’s paying attention to DeFi, NFTs, and the Web3 shift from offline to online
Unsurprisingly, the topics of the metaverse and NFTs came up more than once during the Public.com Town Hall. Retail investors wanted to know if Wood was buying into the hype, and if Web3 as a theme fits within ARK’s vision for disruptive innovation.
Citing Big Ideas research, Wood shared that internet users spent 38% of their free time online and 62% offline on average in 2021—and that ARK expects these averages to flip over time.
“We are very much focused on the Web3 revolution and the shift from offline to online activities,” she said. “We estimate that revenue associated with discretionary online time will increase from $1.8 trillion today to $4.1 trillion in 2026.”
Will ARK be trading NFTs anytime soon? Wood stated that ARK does not actively trade NFTs, but does have “conviction in DeFi and the utility of NFTs for various use-cases.”
Blockchain’s use-cases beyond crypto, according to Wood
With interest in crypto continuing to enter into the mainstream, curiosity around blockchain was also abound in Wood’s Town Hall. Public.com members asked Wood to unpack how ARK thinks about blockchain’s applications beyond crypto. Here’s what she shared.
Citing ARK’s latest Big Ideas report, Wood described the blockchain opportunity as three revolutions:
- Money Revolution – Coordination of value transfer and property rights outside the purview of centralized authorities, governments, and top-down control.
- Financial Revolution – Coordination of financial services and contracts outside the purview of traditional financial institutions.
- Internet Revolution – Coordination of identity, reputation, and data outside the purview of traditional media conglomerates and big tech.
Cathie Wood’s Public.com Town Hall can be viewed in full here.
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https://www.entrepreneur.com/article/417840