Cathie Wood’s ARK: The Ever-Volatile Bet on Innovation

Drilling back to the largest positions, the high-conviction strategy is clear. Tesla (TSLA) is still ARK Invest’s largest holding at approximately 8% of the overall portfolio, valued at a whopping $844 million. Tesla is still a giant position that reflects Cathie Wood’s unshakeable belief in the electric car and clean energy theme despite Tesla’s day-to-day volatile share price movements based on quarterly delivery numbers and margin compression. Tesla was always the poster child for the “disruptive innovation” tag that is given many of the picks of ARK Invest – the thought being that these energy and artificial intelligence businesses will come to outweigh near-term misses on earnings.

These are a set of familiar names: Roku, Palantir, Roblox, and Coinbase that collectively occupy about 5% of the portfolio. This is a snapshot of a thematic approach for ARK. You’ve got video streaming (Roku), big data artificial intelligence infrastructure (Palantir), virtual immersive universes (Roblox), and decentralized finance exposure (Coinbase). Volatility that lies inherent, Wood doesn’t seem to see these as structural bets for acceleration. Her insistence on not pulling back these names for thin or for fat (or even doubling back) promises us that ARK is not playing for short-term pops.

One of the top 10 surprise contributors was Robinhood Markets Inc (HOOD), which accounted for well less than 4%. It reflects Wood’s contrarian approach, while most of Wall Street was wary of Robinhood’s back-and-forth user counts, the thesis of ARK was that the retail revolution was not finished. In a similar way, are looks of COME being supportive of ARK’s long-time holding of leading-edge biotech and health-tech, a category which at the same time was a fund's Achilles heel, but hope.

The two-year stacked bar chart of sector exposure is a remarkable picture of the strategic consistency of ARK, but a slight nuance. Since Software & IT Services is at the top of the pile for each quarter, the relative weighting of Aerospace & Defense, Biotechnology, and Semiconductors reveals that while ARK was never afraid of skewing in its sandbox of innovation, these three never got a particularly high weighting relative to Software. As examples, Biotechnology & Medical Research only makes modest movements, which are most likely reflected in the highly volatile performances of names like CRISPR or other gene-editing daydreams that once powered massive upside during the pandemic bubble.

Interestingly, the “Professional & Commercial Services” article, small, shows tolerance for bets in adjacent segments well-tailored for the tech transition, i.e., companies crafting the paths for artificial intelligence or providing data-based advisory for digital economies. These segments, of course, are insignificant relative to the underlying software and consumer tech disintermediation businesses, but they suggest that ARK might be considering hedging bets on moonshots with more stable recurring revenue-providing businesses.

Cathie Wood justifies her extreme transparency, ARK keeps a publicly downloadable, end-of-day list of every single trade. This new update is classic ARK: new aggressive buys, selective selling, some speculative bets on industries most funds wouldn’t even look at today. DoorDash Inc., for example, shows up as a 178,520-share new holding, now worth around $44 million. It’s a pretty clear suggestion that Wood is still a believer that on-demand logistics is a sticky, long-term trend despite growing regulatory pressure on the gig economy.

The eToro Group Ltd. sale may seem strange on the surface but fits with the overall strategy of ARK. As eToro makes investment more democratic, and because eToro is linked to crypto, there is a good chance that ARK figures this is a moment to reduce some chips off the table due to the riskiness of digital coins. Same with the sell-side deals: the company narrowed bets on the 3iQ Bitcoin ETF and 3iQ Ether Staking ETF, which means that they are taking profits or rebalancing exposure to crypto as the prices move. Even sales of long-established Asian shares such as Nikon and Ly hint at a larger theme, i.e., that ARK is more at ease redeploying capital towards areas where, in its opinion, there are sharper paths for disruptive growth.

The fund value of the ARK was volatile off the 2020 high. In our chart of performance, we document that fund value came back enthusiastically from the second half of 2023 only to give up some of these gains working through the second half of 2025, so our level of Q2 is about $10.44 billion.

The performance curve of our portfolio, for the second year in a row, is similar to that of S&P 500 but more volatile, with the familiar list of high-beta names of ARK moving more enthusiastically on risk-on themes but earlier on drawdowns. It exposes the two-faced character of the fund strategy of ARK. As expansionism and tech euphoria goes viral, the fund will return long before the indices. But when risk appetite falls off the market, and interest rates are volatile, the same sensitivity proves to be a drag. 

It is, contrarily, a compressed mirror of Cathie Wood’s personality, being fearless, unapologetic, long-term oriented, and from time to time, hardly contrarian. Last seen, the 2025 Q2 snapshot reveals a laser-guided fund of record fixated on the same columns of innovation that forged its fame: life science breakthroughs, next-generation finance, and transformational tech. 

What'll be keeping investors up at night is that the cycle of the market, interest rates, and competitive advantage all neatly align for paying back the outlier return that it promises. Short term, given ARK, you're still speculating on a future that hasn't arrived but one that Wood believes is for the near future.