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Topple in Coinbase Presses Wood’s ARK Fund Closer to Pandemic Low|Investing News


May 11, 2022
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NEW YORK CITY (Reuters) – A collapse in cryptocurrency business Coinbase Global Inc pressed star stock picker Cathie Wood’s ARK Development ETF down almost 8% on Wednesday, putting it within 10% of its low touched in March 2020 at the start of the coronavirus pandemic.

Coinbase, the fund’s second-largest holding at almost 7% of possessions, fell more than 28% to tape lows Wednesday after the business missed out on first-quarter quotes and its president stated the business had no danger of personal bankruptcy.

The decreases in Coinbase contributed to the discomfort for Wood’s ARK Development fund this year.

ARK did not react to an ask for remark.

The fund surpassed all other actively handled U.S. equities in 2020 on the strength of its portfolio of business such as Zoom Video Communications Inc and Teladoc Health Inc that rallied throughout the pandemic-induced financial lockdowns.

That strong efficiency made Wood a family name and resulted in looks on publication covers and billions of dollars in inflows from retail financiers, though some now consider her the poster kid for the so-called pandemic bubble.

ARK is down almost 60% for the year to date, and almost 76% listed below its high in February 2021. It traded at $37.98 at mid-afternoon, 8.6% above its low of $34.69 struck in March 2020 prior to the Federal Reserve and Congress let loose an unmatched $5.2 trillion to support the economy.

In a webinar Tuesday, Wood blamed much of the fund’s losses on the Fed taking a too-aggressive course of rate walkings at a time when the international economy remains in what she thinks is an economic crisis.

However other financiers disagree. Matthew Tuttle, whose $460 million Tuttle Capital Short Development Fund shorts ARK’s portfolio, blamed Wood’s losses on “numerous compression.”

” These business make no cash, in a no rate of interest environment they can, and do, command high multiples (however) in an increasing rate environment they do not,” he stated.

( Reporting by David Randall; Modifying by Richard Chang)

Copyright 2022 Thomson Reuters

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