innovation
Investors have shown a lot of interest in thematic exchange-traded funds (ETFs) since 2019. These funds focus on specific themes or sectors expected to grow rapidly in the future. One of the prominent players in this space is ARK Invest, headed by Cathie Wood. Wood invests in disruptive innovation in fields such as biotechnology, fintech, telecommunications, and more.
Many of her thematic ETFs have achieved remarkable returns this year. However, they also have high expenses due to their active management approach and high volatility due to the early-stage nature of many of the companies in these funds. However, her ARK Invest funds can still be a useful source of ideas for investors who do not want to pay high fees or own an actively managed ETF.
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Which Cathie Wood-owned stocks are worth buying right now? Although both of these biotech stocks are speculative, aggressive investors should consider leaning into Ginkgo Bioworks Holdings (NYSE: DNA) and Recursion Pharmaceuticals (NASDAQ: RXRX) ahead of the new year. Here’s why.
Ginkgo Bioworks: Customized biology
Ginkgo Bioworks, Ginkgo for short, is a pioneer in the field of synthetic biology. The company does not create products for consumers but rather enables the creation of biologically based products by improving the efficiency of the design-build-test-learn cycle. One of the key advantages of its business model is that it benefits from network effects as it acquires more customers and data. So, Ginkgo stock might be an attractive opportunity at the moment.
This year, the company has expanded its presence in the pharmaceutical research and development space. That includes partnering with Pfizer for the discovery of RNA-based therapeutics and with privately held Arbor Biotechnologies for novel gene-editing tools.
Moreover, Ginkgo has joined forces with Google Cloud to develop large language models for biological engineering. These business development transactions are proof positive that its novel value proposition is indeed landing with major players across industries and…
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