Trailblazing Investments: The Rise and Fluctuations of Cathie Wood and ARK Invest
Biography of Cathie Wood - Founder & CEO of ARK Invest
A woman named Catherine Duddy Wood, born in 1955. She's from
America and she's really good at investing money. She started a company called
ARK Invest where she's the boss, and she's in charge of making decisions about
where to put people's money to help it grow.
One of the main funds she runs is called the ARK Innovation
Fund ETF. It's like a basket where she puts different types of investments to
try and make money for the people who trust her with their cash. This fund got
a lot of praise for doing well in 2017, 2020, and 2023. But there's a twist in
the story. A group called Morningstar said that from 2014 to 2023, this fund
was the third worst at making money compared to others. So, while it did great
in some years, it also didn't do so well overall during that time.
Early Life and Education
Catherine Duddy Wood was born in Los Angeles. Her parents,
Gerald and Mary Duddy, came to America from Ireland. Gerald had interesting
jobs—he worked in both the Irish Army and the United States Air Force as someone
who dealt with radar systems. Catherine was the oldest child in her family. She
went to Notre Dame Academy, which is a school in Los Angeles just for girls,
and she graduated from there in 1974.
Later on, in 1981, Catherine went to the University of
Southern California. She did really well and graduated with top honors. She got
a degree in finance and economics, which means she learned a lot about money
and how it works. One of Catherine's professors at USC was a famous economist
named Arthur Laffer. He was so smart that he advised two U.S. presidents,
Ronald Reagan and Donald Trump. He became Catherine's mentor, which means he
helped and guided her in her studies and career.
Biography of Cathie Wood - Founder & CEO of ARK Invest
Initial Career growth and setbacks
Back in 1977, thanks to her mentor Arthur Laffer, Catherine
Wood landed a job as an assistant economist at Capital Group. She spent three
years there, learning the ropes of the financial world. In 1980, Catherine
decided to move to New York City for a new job at Jennison Associates. At
Jennison, she wore many hats—she was the chief economist, an analyst, a portfolio
manager, and even a managing director. She stayed there for a whopping 18
years! In the early 1980s, she even had a debate with Henry Kaufman about why
she thought interest rates had reached their highest point.
Then, in 1998, Catherine teamed up with Lulu C. Wang to
start Tupelo Capital Management, a hedge fund in New York City. Later on, in
2001, Catherine joined AllianceBernstein. She became the chief investment
officer for global thematic strategies, where she managed a whopping $5
billion. But during the 2007–2008 financial crisis, some people didn't think
she did such a great job. They said she didn't perform as well as the overall
market during that tough time.
Personal Life
Catherine Wood lives in St. Petersburg, Florida. She was
married to Robert Wood, who passed away in 2018, and they have three children
together. She's a devout Christian and during the 2020 election, she spoke out
about her concerns regarding Joe Biden's taxation and regulation plans, fearing
they might slow down innovation. In 2018, she gave money to her old high school
to kickstart the Duddy Innovation Institute, which encourages young girls to
get into disruptive innovation.
Birth of ARK Invest
In 2014, Catherine Wood had this big idea about making
investment funds that actively managed exchange-traded funds (ETFs) based on
really innovative and disruptive stuff. But her bosses at AllianceBernstein
thought it was too risky, so she left and started her own company called ARK
Invest. She named it ARK after reading about the Ark of the Covenant in the
Bible. The first batch of money to start her company came from a guy named Bill
Hwang of Archegos Capital. Now, Catherine's funds have had some ups and downs.
Some people say they're like rollercoaster rides because they go up and down a
lot.
For example, in 2020, her main fund called ARK Innovation
(ARKK) did amazingly well. It was the best global equity fund with over a
billion dollars in assets. Because of this, Catherine was named the best stock
picker of the year by Bloomberg News. But then in 2021, ARKK fell by 24%, which
wasn't so great. And in the first part of 2022, it was the worst performer
among all the funds that Morningstar tracks. Overall, from 2014 to 2023, ARKK
made a 122% return, which sounds good, but it's less than half of what a big
stock index called the Nasdaq-100 made during the same time.
Here's a summary of how ARKK did each year, according to
Morningstar:
2020: Up by a huge 149%
2021: Down by 24%
2022: Down by 67%, the worst performer at the start of that
year
2023: Up by 68%, still doing pretty well
Cathie Wood's impact as a star stock-picker and the founder
of ARK Invest, a firm with a whopping $60 billion in assets, cannot be
overstated. She's all about investing in groundbreaking technologies like self-driving
cars and genomics. Before launching ARK in 2014, Wood gained experience at
other investment firms. But she wanted to shake things up by creating a way to
actively manage stock portfolios in a format called ETFs, or exchange-traded
funds.
Her main fund, the Ark Innovation Fund, is a big deal, with assets totaling around $23 billion. Over the past five years, it's been delivering an average return of nearly 45% annually. That's seriously impressive! Wood's education at USC, where she studied economics under the famous Art Laffer, played a big role in shaping her investment philosophy. Laffer's Laffer Curve, which talks about how tax rates affect tax revenue, influenced her thinking. She's also a huge fan of Elon Musk's Tesla.
Legacy and Net Worth
Cathie Wood's wealth is closely linked to how well the ARK
funds perform, and it's had its ups and downs over time. As of June 2022,
Forbes estimated her net worth at around $140 million, which is a drop from the
$400 million figure they reported in 2021. However, other media sources suggest
her net worth in 2023 could be between $250 million to $300 million. Wood makes
most of her money from the fees charged to investors for managing ARK's funds.
For the actively managed ETFs, they charge an annual fee of 0.75%, which means
they earn $7.5 million for every $1 billion invested.
In 2020, Barron's reported that Wood owns between 50% to 75%
of ARK. However, the exact amount of her personal funds invested in ARK's ETFs
hasn't been made public. Aside from her investments, public records show that
Wood owns a home in Wilton, Connecticut, where the average home value is around
$1 million according to Zillow.
Catherine is a big supporter of Bitcoin and other
cryptocurrencies. In fact, as of 2024, a quarter of her total wealth is
invested in Bitcoin. She's also been recognized for her achievements. In 2021,
she was selected for Forbes' 50 Over 50 list, which celebrates people over 50
who are making a big impact in their fields.
