One of Cathie Wood’s signature moves is buying stocks when they pull back, looking for names she believes will recover over time.
The CEO of Ark Investment Management followed that playbook again in the past week, picking up a tech stock that dropped 16.3% over the last five trading days.
Wood’s investment strategy has worked well this year, with her funds outpacing the major market indexes. As of Nov. 7, the flagship Ark Innovation ETF (ARKK) is up about 40% year-to-date, far outpacing the S&P 500’s gain of 14.2%.
Wood gained a strong reputation after the Ark Innovation ETF delivered a 153% return in 2020. The same style that produces big wins in a rising market can also bring heavy losses, as it did in 2022, when the fund fell more than 60%.
Those swings have weighed on her long-term results. As of Nov. 6, the Ark Innovation ETF has delivered a five-year annualized return of -4.07%, while the S&P 500 has an annualized return of 15.57% over the same period, according to data from Morningstar.
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Wood’s investment strategy is straightforward: Her Ark ETFs typically target emerging high-tech companies in fields such as artificial intelligence, blockchain, biomedical technology, and robotics.
She believes these companies have the potential to reshape industries and deliver outsized long-term returns, but their volatility leads to big fluctuations in the values of Ark funds.
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.
“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 12 months through Nov. 6, the Ark Innovation ETF saw about $1.38 billion in net outflows, according to ETF research firm VettaFi.
On Nov. 5, Wood’s Ark funds purchased 521,867 shares of Pinterest (PINS), valued at approximately $13.8 million, following the social platform’s stock plunge after disappointing earnings and outlook.
Wood hasn’t been active in trading Pinterest shares. Her previous move on the stock was in August, when she bought 643,416 shares.
On Nov. 4, Pinterest shares sank 21.76%, wiping out the stock’s gains for the year after the company posted third-quarter results that fell short of earnings expectations and offered a soft outlook.
Earnings per share were 38 cents on an adjusted basis, missing the 42 cents analysts expected. Revenue came in at $1.05 billion, matching forecasts.
For the fourth quarter, the company expects revenue of $1.31 billion to $1.34 billion. The midpoint of that range came in below Wall Street’s estimate.
Pinterest’s finance chief, Julia Donnelly, said during the earnings call that the company saw “pockets of moderating ad spend” in the United States and Canada during the quarter. She linked the slowdown to “larger United States retailers” facing tariff-related pressure on their margins.
“We see these broader trends and market uncertainty continuing with the addition of a new tariff in Q4 impacting the home furnishing category,” Donnelly said.
Social media giant Meta’s report, however, showed strong digital advertising sales. Its third-quarter revenue, with about 98% coming from online ads, rose 26% year over year to $51.24 billion. It was the company’s fastest revenue growth since the first quarter of 2024.
Citi has lowered its price target on Pinterest to $38 from $50, but keeps a buy rating on the shares.
“While these challenges could persist into ‘26, we are encouraged with Performance+’s 24% conversion lift, ROAS Bidding accounting for 22% of lower-funnel retail revenue, and the potential around newer Search & Shopping ad products. This as engagement continues to improve with Gen Z 50%+ of total users,” the analyst wrote in a research report.
“While we acknowledge advertiser challenges, with shares down about 20% following results, we would take advantage of the dislocation,” the analyst added.
Tesla Inc.: 13.15%
Roku Inc.: 5.84%
Coinbase Global Inc Class A: 5.50%
Crispr Therapeutics AG: 5.10%
Shopify Inc Class A: 4.66%
Tempus AI Inc.: 4.57%
Advanced Micro Devices: 4.33%
Robinhood Markets Inc Class A: 4.31%
Palantir Technologies Inc Class A: 4.07%
Roblox Corp Class A: 3.93%
Pinterest is not among the top 10 holdings of the Ark Innovation ETF.
Wood also trimmed several names recently. The Ark funds reduced 56,095 shares of Robinhood Markets (HOOD) for about $8 million. The Ark Next Generation Fintech ETF sold 11,989 shares of Reddit (RDDT) for about $2.4 million, and the Ark Fintech Innovation ETF sold 60,808 shares of SoFi Technologies (SOFI) for about $1.8 million.
