Arkk Nvda Stock Performance Raises Concerns

The stock performance of ARKK and NVDA has been a topic of discussion among investors. ARKK's 70% decline in 2022 is a stark contrast to its 155% return in 2020.

Investors have been questioning the sustainability of ARKK's growth strategy. NVDA's 10% decline in Q4 2022 has also raised concerns about the company's financial performance.

The decline in ARKK's stock price has led to a significant decrease in its assets under management. NVDA's revenue growth has slowed down, which has contributed to the decline in its stock price.

Investors are now re-evaluating their investment strategies in ARKK and NVDA.

Discover more: Nvda Stock Growth

Cathie Wood's Ark Invest has made headlines for its bold investment strategies, but it's had its share of misses as well. The fund sold out of its Nvidia position too early, missing out on a huge increase in price.

Wood has been known to hold stocks for five-to-10-year outlooks, but in the case of Nvidia, Ark Invest sold its shares in January 2023 after selling a large portion in November 2022. Those original shares would be worth significantly more than when sold.

On a similar theme: Nvda Shares Outstanding

The Ark Innovation ETF invested in Nvidia on several occasions before selling out, with Wood recalling investing in Nvidia early during an interview. She mentioned a brainstorming session that led to buying shares in 2014 back at a price point of around $5.

Selling winners isn't new for Wood, who shared that sometimes it's smart to take profits. She said Ark Invest would take profits if a stock is up 20, 30, 50, 100, or 200% in a short period of time.

The fund sold a sizable chunk of Nvidia shares from its flagship fund and several other Ark ETFs on Nov. 9, 2022, when the price was $142.11. This would have been worth $109,834,545.20 at the time.

Today, those same shares would be worth $616,676,414.76, meaning Ark Invest may have missed out on potential profits of $506.8 million by selling the Nvidia shares early.

Cathie Wood has raised concerns about NVIDIA's valuation, citing it as "very high" when she sold the company's shares in January 2023.

Wood's Ark Invest sold a significant portion of NVIDIA shares in November 2022, and completely divested from the company by January 2023.

By selling NVIDIA shares early, Ark Invest may have missed out on potential profits of $506.8 million, according to calculations based on the company's current stock price.

Wood has emphasized her firm's stance on NVIDIA, likening its trajectory to stocks that crumbled during the 2000 Internet bubble, and highlighting the looming threat of increased competition for NVIDIA from large customers like Meta, Facebook, and Google.

NVIDIA's recent earnings report provided reassurance to investors, but Wood's warnings about long-term threats to NVIDIA's dominance in the AI chip market are not unfounded, and forecasts of sustained profit margins above 50% may be optimistic in the face of potential competition and pricing pressures.

Cathie Wood's Ark Invest sold its position in Nvidia too early, missing out on a huge increase in price.

The Ark Innovation ETF sold its Nvidia shares in January 2023 after selling a large portion beginning in November 2022.

Those original shares would be worth significantly more than when sold, with Nvidia's price increasing by 612% since November 2022.

Nvidia's valuation was "very high" according to Wood, who said the flagship fund had consolidated to its highest conviction names at the time.

The fund sold 772,884 shares of Nvidia, worth $109,834,545.20 at the time, but would be worth $616,676,414.76 today.

This means Ark Invest may have missed out on potential profits of $506.8 million by selling the Nvidia shares early.

Nvidia is no longer a holding in the Ark Innovation ETF flagship fund, but is part of several other Ark ETFs.

The stock is held in the Ark Next Generation Internet ETF, Ark Genomic Revolution ETF, Ark Fintech Innovation ETF, and Ark Autonomous Technology & Robotics ETF.

Cathie Wood has been known to sell down her Nvidia holding last year.

One thing that might make her reinvest in Nvidia is a specific event or catalyst that changes her outlook on the company.