Ark Invest's Cathie Wood is warning investors that major Chinese companies are losing value amid an anti-monopoly and data security crackdown by Beijing. "The incentives to become incredibly successful in China are diminishing somewhat now that the government is expressing concern," Wood said during an Ark Invest webinar on Tuesday. "Some people feel they have more power than the government would like them to have. So I do think there's a valuation reset." China is starting to crack down on its titans and vowed to update rules for companies listing on U.S. exchanges . The Chinese government fined Tencent, Alibaba and newly public Didi for anti-monopoly behavior earlier this month. Newly public ride hailing app Didi tanked when China announced that new users in the country would not be able to download the app while it conducts a cybersecurity review of the company. Last week amid the crackdown, Wood sold 340,453 shares of Tencent and offloaded 352,991 shares on Monday. Plus, Wood sold 341,190 shares of JD.com last week and another 66,600 shares on Monday. JD.com, Baidu, Tencent and Alibaba are still top holdings in ARK Autonomous Technology & Robotics ETF. "In terms of these very large mega-cap companies being able to scale to other parts of the world, I have a feeling there are some national security considerations that might either slow them down or stop them," Wood said. "I would say from a valuation standpoint these stocks have come down and from a valuation point of view [they] will probably remain down." Wood — reported to be fond of the Trump administration's foreign policies with China — emphasized the need for "sustaining the policies of the last administration," she said.
Crystal Mercedes | CNBC
Ark Invest's Cathie Wood is warning investors that major Chinese companies are losing value amid an anti-monopoly and data security crackdown by Beijing.