May 27, 2021
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Let's turn to news about Cathie Wood and her colossal ARK Invest, which only a mere few years ago was anything but gigantic. In fact, I’d challenge you to think of when you first heard of Cathie Wood or ARK Invest. My educated guess would be mid-2020 at the earliest. That’s not even one year ago.
Of course, as massive amounts of money were being pumped into the system about a year ago, to combat pandemic restrictions and lockdowns, seemingly coincidentally her investment funds began to explode to the positive. It seemed like she was turning into Mrs. Midas, as everything she touched turned to gold. Naturally, the more such news surfaced, the more money flooded her way, perpetuating her grandioseness with little proof of actual skills and insights. Now, as the tech industry sees a reversal of wealth trends this year, so do the fortunes of Ms. Wood seem to be changing.
And it’s of little comfort for her to be seeing a growing number of asset managers taking positions against her. Sure, these money managers are only suggesting they’re doing so to protect their portfolios from the windfalls they’ve experienced thus far, but I can’t help and wonder if there’s more to it than just that.
As I’ve pointed out before in summoning an ancient Japanese proverb, “Fast ripe. Fast rotten”. Does the same apply here?
Don’t get me wrong. I enjoy seeing significant returns in short periods of time. But it’s important to study and understand why such is happening. Is it merely a mania that’s jacking prices up? Or are there foundational rationales, which could be long lasting and much more beneficial to one’s investment portfolio?
SOURCE: BNN Bloomberg