Cathie Wood on investors betting against her: Shorting innovation in America is 'ridiculous'

Published Thu, Feb 17 20221:10 PM ESTUpdated Thu, Feb 17 20224:17 PM EST

Kevin Stankiewicz @in/kevinstankiewicz @kevin_stank

Innovation money manager Cathie Wood on Thursday pushed back on those who doubt her innovation-focused investment strategy, telling CNBC she believes it's misguided and too focused on the short term. "The idea of shorting innovation, in America, is ridiculous, I think," the founder and CIO of Ark Invest said on CNBC's "Halftime Report." "When I see people so sure that we are wrong that they are willing ... to set up funds to short innovation, you know that investor psychology, the pendulum, has swung so far in one direction, that if we're right ... the rewards are going to be enormous," she added. Woods' comments came in response to a question from CNBC's Scott Wapner , who asked the prominent portfolio manager what she thought about the creation of the Tuttle Capital Short Innovation ETF . It listed on the Nasdaq in early November and trades under the ticker SARK — a clear reference to Wood's firm Ark. As CNBC's Jim Cramer explained last month , the Tuttle Capital Short Innovation ETF basically goes short the stocks that Wood is long. In other words, what's negative for Wood's stocks is positive for owners of the Tuttle Capital Short Innovation ETF. Wood ascended to prominence in 2020 as multiple of her firm's funds, including its flagship ARK Innovation ETF (ARKK), posted impressive returns; major inflows into the ETFs followed. However, 2021 was a more challenging year as market leadership turned away from the kinds of high-growth stocks that Wood's funds typically owns such as Teladoc and Zoom Video. It's been more of the same so far in 2022, as ARKK is down more than 26% year to date. Another one of its funds, the ARK Next Generation Internet ETF, is down nearly 25% year to date, as Wall Street prepares for the Federal Reserve to hike interest rates. "They're shorting innovation and over time, that is not going to be a business, if you ask me. Consider the source," Wood said. "But they're also not doing any research. They're simply shorting innovation. If they were doing research and could point us to reasons why what we've included in our portfolio is not going to partic