Cathie Wood's Bold NVIDIA Bet: ARK Invest Ups Ante Ahead of Earnings Report

On Tuesday, Cathie Wood, the leader of ARK Invest, executed a significant increase in her holdings, purchasing 34,543 shares of chip giant NVIDIA (NVDA.US) just before the company announced its earnings report. Specifically, her flagship fund, ARK Innovation ETF (ARKK.US), acquired 21,504 shares, while ARK Next Generation Internet ETF (ARKW.US) bought 13,039 shares, elevating NVIDIA's positions to 29th in ARKK and 24th in ARKW rankings.

This recent addition to holdings stands in stark contrast to ARKK's historical activity. Since November 2022, the fund's ten transactions with NVIDIA have included eight instances of selling and only two of buying, with purchases happening this Tuesday and on May 7th, when 64,838 shares were acquired. A similar pattern was observed in ARKW's trading history, with eight of the past ten transactions being reductions and only two instances of buying, one on Tuesday and the other on May 7th with 19,645 shares.

As the central focus for the 2024 AI market, NVIDIA is set to reveal its latest financial results post-market on Wednesday. Cathie Wood’s unusual move of increasing holdings at this pivotal moment comes as the market turns attention to NVIDIA's earnings guidance. By simultaneously boosting positions through two actively managed ETFs, ARK Invest not only maintains its cautious optimism toward NVIDIA since May but also suggests a potential shift in strategy concerning its investment in AI-leading stocks.

Current portfolio data indicates that despite NVIDIA not yet being among ARKK's top ten holdings, its ranking rose significantly following this transaction compared to the end of the previous quarter. In the context of ongoing explosive growth in AI computing power demand, the upcoming performance report from this globally third-largest chip giant will likely affect ARK Invest's future rebalancing rhythm.