IMPORTANT POINTS:
- Cathie Wood is recognized for investing in innovative and cutting-edge companies. However, she decided not to get involved in Arm’s IPO.
- The company from the United Kingdom is dedicated to designing semiconductors and recently debuted on the Nasdaq, with a price of $51 per share and a valuation of almost $60 billion.
- After almost a week of trading, Arm shares are very volatile and sit around $52.50.
Last Thursday saw the successful initial public offering (IPO) of Arm, a UK-based chip designer, and Cathie Wood explained why she didn’t invest in the company.
It is worth clarifying that Arm is controlled by the Japanese giant SoftBank and began trading on the Nasdaq at a price per share of $51 and a valuation of almost $60 billion.
On its first day of trading, Arm shares soared nearly 25% to close above $63. However, the shares did not stay afloat these days and today they are trading at $52.50.
Cathie Wood gave her candid opinion on Arm
In a talk with CNBC, the businesswoman clarified that there are better opportunities in the stock market, especially those linked to artificial intelligence.
“We did not participate in that IPO as we compared it to the stocks in our portfolios. “We believe Arm is overvalued and we see much lower values within our portfolios, names with much more exposure to AI.”Wood.
Currently, Ark Innovation’s top holdings are: Tesla, Shopify, Twilio, Coinbase, Roku, DraftKings, UiPath, Unity Software, Zoom, and Block (ex Square).
The investor believes a “good environment” is ahead for the innovation sector as inflation eases and central banks consider curbing interest rate increases.
On the other hand, Ark Invest acquired a European, more precisely British, fund for the first time. This is Rize ETF, worth close to $6.5 million.
“We are very open-minded about technologies that are flourishing around the world, including Europe,” Wood concluded.
