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Cathie Wood’s ARK Invest sold more Tesla stock on Friday. That’s twice in a week.
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ARK Invest’s ARK Innovation exchange-traded fund sold another 62,415 shares of Tesla worth about $16 million, the asset management company founded by Cathie Wood disclosed on Friday evening.
The news of Friday’s stock sale comes after ARK Invest offloaded about 393,000 shares of Tesla (ticker: TSLA) worth almost $100 million from the Innovation ETF (ARKK) and two other funds on Monday.
ARK didn’t respond to a request for comment about Monday’s sales, and the company didn’t respond immediately to a request for comment over the holiday weekend about Friday’s sales.
But Wood might be selling because of Tesla’s recent success: Shares are up almost 50% over the past month, crushing the 10% and 6% comparable, respective gains of the
Nasdaq Composite
and
S&P 500.
Tesla stock’s run has helped push the Innovation ETF up about 15% over the past month, too.
It’s unlikely that Wood is taking profits or that she believes Tesla shares are fully valued. ARK’s published price target for Tesla stock is $2,000 by 2027, up almost eight-fold from Friday’s close—which works out to an average annual gain of about 66% between now and the middle of 2027.
The problem is more likely structural: Tesla stock comprises more than 11% of the Innovation ETF’s portfolio. Practically speaking,10% seems to be a rule of thumb for ARK: When things get above a certain percentage of the portfolio, the company trims. ARK may not be done selling, since Tesla’s stock price performance has pushed it beyond 11% of the…
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