Cathie Wood, CEO of Ark Investment Management, is known for investing in high-growth tech companies. She’ll even add to positions amid strong gains, and that’s what she just did, adding shares of a megacap stock that has surged 14.8% over the past five days.In 2025, the flagship Ark Innovation ETF gained 35.49%, far outpacing the S&P 500âs return of 17.88% in the same period. So far this year, Woodâs flagship Ark Innovation ETF (ARKK) is up 3.05% year to date, while the S&P 500 surged 10.66% as of July 10, Yahoo Finance data shows.Wood gained a reputation after the Ark Innovation ETF delivered a 153% return in 2020. But her style also brings painful losses in bearish markets, as seen in 2022, when the Ark Innovation ETF tumbled more than 60%.Those swings have weighed on Woodâs long-term gains. As of July 10, her Ark Innovation ETF has delivered a five-year annualized return of -8.42%, while the S&P 500 has an annualized return of 11.63% over the same period, according to data from Morningstar.
Over the past 12 months through July 8, the Ark Innovation ETF saw roughly $1.25 billion in net outflows.Getty Images
Cathie Wood flags âthe deflationary impactâ of tech innovationWood focuses on high-tech companies across artificial intelligence, blockchain, biomedical technology, and robotics. She thinks these businesses have strong growth potential, though their volatility often causes fluctuations in the Arkâs funds.From 2014 to 2024, the Ark Innovation ETF wiped out $7 billion in investor wealth, according to a March 2025 analysis by Morningstarâs analyst Amy Arnott. That made it the third-biggest wealth destroyer among mutual funds and ETFs in Arnottâs ranking. The analyst hasnât updated her ranking.Wood believes investors have been focusing on the wrong signals as they assess the outlook for inflation, interest rates, and stocks.In a June post on X, Wood said the bond market is increasingly reflecting the deflationary impact of technological innovation, particularly artificial intelligence, rather than the inflation risks many investors still fear.Wood pointed to the continued flattening of the Treasury yield curve despite a sharp rise in oil prices over the past year. In previous cycles, she noted, an energy shock of that magnitude would have pushed long-term yields higher. Related: Cathie Wood buys $2.1M of tumbling AI stockWood believes the bond market is “discounting something much more powerful: the deflationary impact of technological innovation, particularly artificial intelligence, which is beginning to increase productivity across broad swaths of the economy.âš”She also said easing tensions with Iran and a decline in oil prices could push inflation even lower.”The next phase of this cycle could be characterized by accelerating growth, declining inflation, falling interest rates, and a strengthening U.S. dollar,” Wood said. “That combination would create a remarkably supportive backdrop for innovation-led equities and the technologies driving the next productivity boom.”But not all investors agree with Woodâs optimism. Over the past 12 months through July 8, the Ark Innovation ETF saw roughly $1.25 billion in net outflows, according to data from ETF research firm VettaFi. Cathie Wood buys $22.8 million of CoreWeave stockOn July 9, Woodâs Ark funds bought 34,080 shares of Meta Platforms (META), according to Arkâs daily trade information. Wood made the purchase as Meta stock climbed 14.8% over the past week. Based on the latest closing price of $669.21, the shares are now worth about $22.8 million.Related: Meta CEO sends warning on its AI goal before earningsMeta shares have lagged much of the broader tech sector this year, rising about 1.4% year to date compared with the Nasdaq Composite’s roughly 13% gain, as investors questioned whether the company’s massive AI spending would translate into meaningful returns.However, sentiment has started to improve. On July 10, Meta shares jumped 6% to their highest level since April, extending gains that began after the company outlined plans to sell excess AI computing capacity. A day earlier, Meta launched Muse Spark 1.1, an AI coding model that will compete with offerings from Anthropic and OpenAI.The launch signals Meta is getting more serious about enterprise AI. BNP Paribas analyst Nick Jones said Muse Spark 1.1 is Meta’s first paid AI model, giving the company an opportunity to monetize its AI products, MarketWatch reported.The rally came despite comments from CEO Mark Zuckerberg earlier this month acknowledging that Meta’s AI reorganization has not gone as planned.According to a Reuters report on July 2, Zuckerberg told employees during an internal town hall that Meta’s AI agents have developed more slowly than expected.”The trajectory of the agentic development over at least the last four months hasn’t really accelerated in the way that we expected,” Zuckerberg said. Still, he expects more meaningful returns from the company’s AI investments within the next three to six months.Meta is expected to spend up to $145 billion on AI infrastructure this year, making it one of the biggest AI spenders among Big Tech.Meta is expected to report second-quarter earnings later this month. Investors will be watching whether AI investments are beginning to support revenue growth while keeping spending under control.The company delivered a strong first quarter, reporting adjusted earnings per share of $7.31 on revenue of $56.31 billion, beating Wall Street estimates on both metrics.On July 2, Wells Fargo analyst Ken Gawrelski raised his price target on Meta to $767 from $765 while maintaining an overweight rating, according to The Fly.Ahead of earnings, the analyst expects “another quarter of robust ad growth and an in-line Q3 revenue guide.” Wells Fargo also expects Meta to reaffirm its aggressive AI spending plans while providing more details on opportunities to lease excess computing capacity, calling it “an improving second half of the year catalyst path.”Meta is not in the top 10 holdings of Woodâs Ark Innovation ETF.Top 10 holdings of the Ark Innovation ETF as of July 10, 2026:Tesla (TSLA): 10.21%Tempus AI (TEM): 5.88%CRISPR Therapeutics (CRSP): 5.00%Robinhood (HOOD): 4.82%Shopify (SHOP): 4.48%Space Exploration Technologies (SPCX): 4.33%Advanced Micro Devices (AMD): 4.32%Coinbase (COIN): 3.84%Beam Therapeutics (BEAM): 3.43%Roblox (RBLX): 3.40%Other than buying Meta shares, Wood’s latest trades included adding shares of Space Exploration Technologies (SPCX), Coinbase Global (COIN), X-Energy (XE), and Recursion Pharmaceuticals (RXRX). She also trimmed positions in Advanced Micro Devices (AMD), Deere (DE), 10x Genomics (TXG), Twist Bioscience (TWST), and Strata Critical Medical (SRTA).Related: IKEA closing key U.S. stores  Â