Cathie Wood says she wouldn't have sold Nvidia stake 'had we known that the market was going to reward it'
Paras Griffin via Getty Images; Michael M. Santiago via Getty Images
- Ark Invest's Cathie Wood says she wouldn't have sold her Nvidia stock if she knew it was going up.
- She previously called Nvidia a "check the box stock" with too much "hyperactivity."
- Nvidia's stock has gained 172% this year, and it briefly became the most valuable company in June.
Hindsight is 20/20 for Ark Invest's Cathie Wood, whose fund missed out on the Nvidia stock rally when it sold its position too early.
"Before selling NVDA in ARKK, had we known that the market was going to reward it and the other Mag 6 stocks to the exclusion of stocks that will be the prime beneficiaries of AI, like TSLA - the largest AI project earth - and multiomics names like RXRX, we would have held it," Wood said in an X post on Sunday.
Wood's post referred to four stocks via their ticket symbols — Nvidia, Ark Innovation ETF, Tesla, and Recursion Pharmaceuticals.
She also appeared to reference the "Magnificent Seven," a list of top tech companies that include Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia, and Tesla.
A Nvidia spokesperson declined to comment to Business Insider.
Representatives for Wood didn't immediately respond to a request for comment from BI sent outside regular business hours.
Before selling NVDA in ARKK, had we known that the market was going to reward it and the other Mag 6 stocks to the exclusion of stocks that will be the prime beneficiaries of AI, like TSLA - the largest AI project earth - and multiomics names like RXRX, we would have held it.
— Cathie Wood (@CathieDWood) July 14, 2024
Wood's remarks on Sunday are probably the closest we are ever going to get to a mea culpa from the famed investor. According to The Wall Street Journal, Wood's investment fund sold at least $4.5 million worth of Nvidia stock this year.
"Everyone now understands that Nvidia is the key chip player. It's created the AI age in a sense, but we do think that it has become a check the box stock," Wood told The Wall Street Journal's Dion Rabouin in a podcast that aired in February.
"I've watched Nvidia all my career actually since it's gone public, it's a very cyclical stock," she said. "There's this hyperactivity, everyone excited trying to get in at the same time, so there's double ordering, triple ordering, quadruple ordering, and then there is an inventory correction. We think that will happen again."
But Nvidia's stock price has more than outperformed Wood's bearish prediction. The chip giant's stock has gone up by 172% this year, and it briefly became the world's most valuable company last month.
To be sure, Wood isn't the only one who thinks Nvidia is wildly overvalued.
NYU finance professor Aswath Damodaran said he sold half his Nvidia stake last year after the company hit a $1 trillion valuation.
"The run up has been just so astonishing that I cannot in good conscience hold on to it and call myself a value investor," Damodaran told CNBC in an interview from June 2023.