Cathie Wood is once again leaning into her trademark buy-the-dip strategy, this time snapping up more than $26 million worth of a battered tech stock as markets debate whether innovation-led investing is back in favor.
Wood, the founder and CEO of Ark Investment Management, is known for trimming positions after strong rallies and adding aggressively when prices pull back — a strategy she applies even to her largest holdings. Last week, Ark funds sold Tesla shares to lock in roughly $40 million in gains. At the same time, Wood quietly rebuilt a position in Coinbase Global, one of Ark’s most closely watched and controversial bets.
The move comes during a strong year for Ark’s flagship Ark Innovation ETF. As of Dec. 19, the fund is up 39.39% year to date, far outperforming the S&P 500’s 16.2% gain. The rebound has revived interest in Wood’s high-conviction style after several difficult years that followed the fund’s explosive 153% return in 2020.
Despite the strong 2024 performance, Ark’s longer-term track record remains under pressure. The Ark Innovation ETF is still showing a five-year annualized return of negative 8.72% as of Dec. 18, compared with a 14.48% annualized return for the S&P 500 over the same period, according to Morningstar. In 2022, the fund lost more than 60% as rising interest rates punished speculative growth stocks, highlighting the volatility inherent in Wood’s approach.
Wood’s investment philosophy centers on disruptive technologies such as artificial intelligence, blockchain, genomics, and robotics — areas she believes can drive exponential growth over time but often experience sharp market swings. From 2014 through 2024, Morningstar estimates the Ark Innovation ETF erased roughly $7 billion in investor wealth, making it one of the largest wealth destroyers among funds and ETFs during that period.
Still, Wood remains firmly convinced that innovation — particularly artificial intelligence — is only in its early stages. She has repeatedly pushed back against claims that tech stocks are in an AI-driven bubble.
“I do not believe AI is in a bubble,” Wood said in a recent CNBC interview. She argues that the real productivity gains from AI have yet to materialize, especially at large corporations that need time to restructure operations before fully benefiting from the technology. In her view, today’s valuations reflect future potential rather than speculative excess.
Not all investors are buying that argument. Over the past 12 months through Dec. 18, the Ark Innovation ETF saw about $1.28 billion in net outflows, according to VettaFi, suggesting continued skepticism despite this year’s rally.
That backdrop makes Wood’s renewed buying in Coinbase particularly notable. Between Dec. 15 and Dec. 18, Ark funds purchased 106,530 shares of Coinbase Global, worth approximately $26.1 million. The buying extended a gradual accumulation that began in mid-November.
Earlier in the year, Wood’s relationship with Coinbase had been far more cautious. Ark bought about 34,500 shares in the first quarter, then sold roughly 446,000 shares and another 228,000 shares in the second and third quarters. In total, Wood sold around 5.5 million Coinbase shares over the course of 2024, making the year a net-selling one overall.
Even after those reductions, Coinbase remains the fourth-largest holding in the Ark Innovation ETF, accounting for about 5.28% of the fund as of Dec. 19. Only Tesla, Roku, and CRISPR Therapeutics rank higher.
Coinbase’s stock has struggled this year, reflecting broader weakness in crypto markets. The shares are down about 3% year to date, while Bitcoin has fallen roughly 5.6%, both underperforming the broader equity market. Because Coinbase generates much of its revenue from transaction fees, its fortunes tend to rise and fall with crypto prices and trading activity.
The company is attempting to diversify. On Dec. 17, Coinbase announced plans to roll out stock and ETF trading for U.S. users, allowing customers to trade traditional assets alongside cryptocurrencies within the same app. The move positions Coinbase as a more direct competitor to platforms like Robinhood and reduces its reliance on crypto trading alone.
Wall Street reaction was mixed. Cantor Fitzgerald lowered its price target on Coinbase to $320 from $459, while maintaining an overweight rating. The firm said the push toward becoming an “everything exchange” is strategically positive but warned that near-term revenue and profitability could suffer amid soft crypto sentiment. Analysts also cautioned that consensus expectations for strong trading volume growth in 2026 may prove too optimistic if the market enters another prolonged crypto downturn.
Wood, however, remains optimistic about crypto’s long-term trajectory. She believes Bitcoin’s traditional four-year cycle — driven by mining reward halvings — may be losing relevance as institutional participation grows. According to Wood, declining volatility and increased institutional involvement could limit future drawdowns, suggesting that the recent lows may already be behind the market.
She also argues that Bitcoin’s behavior has changed, trading more like a risk-on asset aligned with equities and real estate rather than serving as a hedge during periods of stress. In that shifting landscape, Wood says, gold has increasingly taken on the role of the true risk-off asset.
For now, her latest Coinbase purchase signals a familiar message: short-term pain, in her view, is creating long-term opportunity — even as the debate over her strategy continues.