From NFTs to the Metaverse: Cathie Wood unpacks ARK’s Big Ideas for 2022 and beyond

<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.

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.”

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.

Disclosures: The content of this presentation is for informational purposes only and is subject to change without notice. This presentation does not constitute, either explicitly or implicitly, any provision of services or products by ARK and participants are encouraged to consult counsel and/or other investment professionals as to whether a particular investment management service is suitable for their investment needs. All statements made regarding companies, securities or cryptocurrencies are strictly beliefs and points of view held by ARK and are not endorsements by ARK of any company, security or cryptocurrency or recommendations by ARK to buy, sell or hold any security or cryptocurrency. Historical results are not indications of future results. Certain of the statements contained in this presentation may be statements of future expectations and other forward-looking statements that are based on ARK’s current views and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in such statements. The matters discussed in this presentation may also involve risks and uncertainties described from time to time in ARK’s filings with the U.S. Securities and Exchange Commission. ARK assumes no obligation to update any forward-looking information contained in this presentation. Certain information was obtained from sources that ARK believes to be reliable; however, ARK does not guarantee the accuracy or completeness of any information obtained from any third party. ARK and its clients as well as its related persons may (but do not necessarily) have financial interests in securities, cryptocurrencies, or issuers that are discussed. There is no assurance that ARK will make any investments with the same or similar characteristics as any investment presented. The reader should not assume that an investment identified was or will be profitable. PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE PERFORMANCE, FUTURE RETURNS ARE NOT GUARANTEED.

https://www.entrepreneur.com/article/417840