Cathie Wood’s ARK investment has become a star in the recent tech boom especially with her successful bet on Tesla.
It’s interesting not only because of its bets in some of the leading tech sectors, but also in the fact that its ETF is very ‘open’ – analysts publish their opinions on social media, and ARK publishes holding movements daily.
Lots of (especially) retail investors follow their trading movements – buying stocks which ARK had added a day earlier, and selling stocks that ARK had ditched (or reduced). ARK related discussions flood many of the retail investor forums.
This is, effectively, a clever way for ARK to create leverage. As a result, the momentum is amplified, for good or for bad: