News: Cathie Wood defends ARKK’s decision to dump Nvidia, citing chip-cycle risks

Cathie Wood has explained her firm's decision to sell off Nvidia Corp. stocks, despite missing out on the subsequent 160% surge in share prices. Wood, the CEO of ARK Invest, cited the cyclical nature of the computer-chip industry as a potential risk. In an interview, she expressed concerns about shortages and the cyclicality of the sector. Wood also pointed out the growing competition Nvidia faces from companies like Tesla, Meta Platforms, and Alphabet, which are developing their own chips for AI applications. While ARK Innovation ETF reduced its Nvidia holdings, other specialized portfolios still have exposure to the company. Wood defended the decision, stating that they are shifting their focus to undiscovered investment opportunities. ARKK has outperformed the S&P 500 this year with a 25% gain. Wood praised Meta's emphasis on AI but noted that it is not currently included in their flagship portfolio. She expressed interest in Meta's LLaMA AI language model, which delivers better results with less computing power and more data. Wood also mentioned her appreciation for Mark Zuckerberg's prioritization of artificial intelligence over the metaverse concept.