Ark Investment Management Founder, CEO and Portfolio Manager Catherine Wood invests in what she calls “Disruptive Innovation.” Wood has been successful with this approach, to say the least. Cloning Ark Investments‘ 13F portfolio since Q1 of 2017 would have resulted in a 39.74% annualized return. That’s nearly triple the S&P 500’s performance over the same period.
ARK Investment Management is a New York City-based hedge fund with total assets under management of $11.45B (Form ADV from 2020-07-07). The fund’s last reported 13F filing for Q2 2020 included $9.28B in managed 13F securities and a top 10 holdings concentration of 48.53%.
According to Ark’s Form ADV, Ms. Wood has over 40 years of experience in “theme-based investing.” In 2018, editors at Bloomberg acknowledged Ms. Wood by selecting her to its second annual “Bloomberg 50”, which is a list of people across business, entertainment, finance, politics, technology, and science whose 2018 accomplishments were particularly noteworthy according to Bloomberg.
Here is Ark’s strategy as described in the fund’s ADV filed with the SEC.
ARK (an acronym for “Active, Research and Knowledge”) specializes in thematic investing in disruptive innovation with a fresh take on fundamental analysis. Thematic investing is based on broader, macroeconomic topics (i.e., themes) rather than benchmarks, and seeks to capture long-term growth independent of sectors, geographic boundaries, and market-caps. Specifically, ARK invests in themes that participate in disruptive innovation across several sectors. ARK defines “disruptive innovation” as the introduction of a technologically enabled new product or service that ARK expects to change an industry landscape. It typically involves declining cost structures, increased productivity and increased unit growth. Despite its potential, ARK believes the full magnitude of disruptive innovation and the investment opportunities it creates are often unrecognized or misunderstood by traditional investors.
Unique to ARK is the use of “Theme Developers” — outside experts who team-up with the fund to research promising investment themes.
ARK “Theme Developers” are academics who partner with the fund, offering valuable insights regarding ARK investment themes.
Theme Developers are thought leaders from a variety of fields, typically academia, who offer meaningful insights, experience, and knowledge about one of ARK’s research themes. The ARK Team actively engages with these Theme Developers in its Open Source Research Process. ARK’s Theme Developers do not receive any form of compensation for participating in the ARK Open Source Research Process and are only benefited through the exchange of ideas, knowledge and research. Also, ARK contractually obligates Theme Developers to, among other things: not exchange material non-public information; not share confidential information about ARK and/or its clients; and disclose all potential or actual conflicts of interest to ARK’s Chief Compliance Officer (“CCO”) initially and on an ongoing basis with respect to serving as a Theme Developer for ARK.
Catherine Wood’s top 20 holdings are diversified among the communications, information technology, health care, finance and consumer discretionary sectors.
Ark Investments’ 13F portfolio as of Q2 2020
| Stock | Sector | Market Value | % of Portfolio | Rank | % Change | Qtr 1st Owned | Estimated Avg. Price |
| TSLA | CONSUMER DISCRETIONARY | $769,200,000 | 8.27 | 1 | 19% | Q4 2016 | 395.08 |
| NVTA | HEALTH CARE | $721,529,000 | 7.76 | 2 | 48% | Q4 2016 | 17.44 |
| SQ | FINANCE | $633,392,000 | 6.81 | 3 | 26% | Q4 2016 | 65.18 |
| CRSP | HEALTH CARE | $476,454,000 | 5.12 | 4 | 51% | Q2 2017 | 54.31 |
| ROKU | INFORMATION TECHNOLOGY | $387,227,000 | 4.16 | 5 | 96% | Q2 2019 | 109.03 |
| TWOU | CONSUMER DISCRETIONARY | $365,328,000 | 3.93 | 6 | 42% | Q4 2016 | 27.45 |
| ILMN | HEALTH CARE | $343,884,000 | 3.7 | 7 | -7% | Q4 2016 | 275.98 |
| ZG | COMMUNICATIONS | $289,300,000 | 3.11 | 8 | 50% | Q4 2019 | 47.47 |
| TREE | FINANCE | $272,359,000 | 2.93 | 9 | 97% | Q4 2016 | 263.81 |
| PRLB | CONSUMER DISCRETIONARY | $249,279,000 | 2.68 | 10 | 38% | Q4 2016 | 95.41 |
Given Ark’s success at identifying companies with ground breaking technology, one may want to analyze new holdings in Ark Investings’ 13F portfolio.
Ark Investments’ 13F new positions Q2 2020.
| Stock | Sector | Market Value | % of Portfolio | Rank | % Change | Est. Avg. Price |
| WORK | INFORMATION TECHNOLOGY | $146,997,000 | 1.58 | 21 | New | 31.09 |
| TXG | HEALTH CARE | $30,058,000 | 0.32 | 49 | New | 89.31 |
| ADPT | HEALTH CARE | $14,956,000 | 0.16 | 70 | New | 48.38 |
| SDGR | INFORMATION TECHNOLOGY | $14,241,000 | 0.15 | 73 | New | 91.57 |
| CRWD | INFORMATION TECHNOLOGY | $13,381,000 | 0.14 | 75 | New | 100.29 |
| OKTA | INFORMATION TECHNOLOGY | $12,330,000 | 0.13 | 77 | New | 200.23 |
| VMW | INFORMATION TECHNOLOGY | $6,791,000 | 0.07 | 92 | New | 154.86 |
| GOOG | COMMUNICATIONS | $4,333,000 | 0.05 | 102 | New | 1,413.61 |
| SPCE | FINANCE | $3,113,000 | 0.03 | 107 | New | 16.34 |
| WKHS | CONSUMER DISCRETIONARY | $1,798,000 | 0.02 | 120 | New | 17.39 |
| ADYEY | $1,229,000 | 0.01 | 140 | New | ||
| LGHEF | $1,181,000 | 0.01 | 144 | New | ||
| PHR | INFORMATION TECHNOLOGY | $637,000 | 0.01 | 161 | New | 28.28 |
| ARNC | Materials | $434,000 | 0 | 168 | New | 13.93 |
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