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Cathie Wood Watch: Ark Shows Love for Palantir

Wash, rinse and repeat.

Cathie Wood, chief executive of Ark Investment Management, purchased shares of Palantir Technologies  (PLTR) – Get Free Report Thursday for the third day in a row.

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Ark funds bought 286,704 shares of Palantir valued at $3.4 million as of Thursday’s close.

The company’s flagship product is Palantir Gotham, designed for use by intelligence agencies and government organizations. Palantir has drawn criticism for working with government agencies involved in surveillance and immigration enforcement in the U.S. and abroad.

Palantir stock has skyrocketed 58% since May 5 on a strong earnings report. It has climbed 82% year to date and 46% over  the last 12 months. Palantir is the 23rd biggest holding in Wood’s flagship Ark Innovation ETF  (ARKK) – Get Free Report, rising a place since Wednesday.

Ark Sold Exact Sciences, Shopify

Also Thursday, Ark Innovation unloaded 141,915 shares of Exact Sciences  (EXAS) – Get Free Report, valued at $11.5 million as of that day’s close. The company is a medical diagnostics provider famous for its Cologuard at-home colon cancer test.

The stock has ascended 68% thus far in 2023, buoyed by strong earnings, and 54% over the last 12 months. Ark has sold more than 4 million shares of Exact Sciences since Jan. 1. But it’s still the sixth biggest holding in Ark Innovation.

Finally Thursday, Ark funds unloaded 25,557 shares of e-commerce host Shopify  (SHOP) – Get Free Report, valued at $1.6 million. Shopify is the eighth biggest position in Ark Innovation.

The company’s stock has soared 30% since May 3, after it announced a sale of most of its logistics business and it laid off 20% of its workforce. Shopify dumped the logistics stake to focus on its core e-commerce platform business.

Its stock has jumped 73% year to date and 67% over the past 12 months.

Wood’s Lagging Returns

Meanwhile, Wood’s performance hasn’t exactly lit the investment world on fire over the past couple years, as her young technology stocks have slumped. Ark Innovation has descended 76% from its February 2021 peak.

Nonetheless, the fund has bounced back 24% so far this year, as tech stocks have rebounded in general.

Mama Cathie, as Wood is known to her fans, defends her strategy by noting that she has a five-year investment horizon. But the five-year annualized return of $7.4 billion-asset Ark Innovation was negative 0.44% through May 18, compared with positive 11.05% for the S&P 500.

The fund’s performance also doesn’t come close to Wood’s goal for annualized returns of 15% over five-year periods.

Ark Innovation enjoyed a net investment inflow of $28 million during the five days through May 18, but suffered a $444 million outflow over the last year, according to ETF research firm VettaFi.

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