Kathy Wood reshuffles ARK portfolio: massive buying of SpaceX amid reduction in Tesla stake
June 12 became a landmark day not only for Elon Musk, whose wealth surpassed the $1 trillion mark for the first time, but also for Cathie Wood. On the day of SpaceX's long-awaited IPO, her ARK fund executed a massive rebalancing, making arguably the biggest bet of the year.
I analyzed the daily trade reports and found that ARK acquired 3.29 million shares of SpaceX at an offering price of $135 per share. By market close, this stake was already worth $529.7 million — a 19% gain in a single day. And this is just the beginning. Simultaneously, the fund significantly cut its positions in Tesla, as well as in Advanced Micro Devices, Rocket Lab, Roku, and Baidu. The shift in priorities is clear.
Why is Tesla no longer ARK's "golden cage"?
For a long time, Tesla shares were the anchor of the ARK Innovation ETF. Wood publicly defended the company during its darkest days. But now the situation is radically different. Chinese competitors like BYD have nearly caught up with Tesla in sales volumes, business margins are declining, and Musk's political activism is alienating a portion of liberal-leaning consumers. For a fund that has lost $294 million in net outflows over the past 12 months, keeping all eggs in one basket has become an unaffordable luxury.
SpaceX, on the other hand, looks like a breath of fresh air. The company's only profitable division — the Starlink satellite internet service — is experiencing explosive growth. Despite a cumulative loss of $41.3 billion as of March 31, the prospects of monetizing space attract Wood. Notably, 30% of the offering is allocated to retail investors — 3 to 6 times higher than the standard level. The fund is clearly betting on public demand.
ARK's return context: A game of anticipation or a desperate move?
Since the start of the year, the ARK Innovation ETF has grown only 1.61%, while the S&P 500 has gained about 9%. According to Morningstar estimates, from 2014 to 2024, the fund "destroyed" approximately $7 billion of its investors' capital. Against this backdrop, entering SpaceX looks like a classic Wood pattern: getting into promising companies as early as possible, before they become mainstream. This was the case with Coinbase in 2021, and with CoreWeave more recently. Now, SpaceX has become the largest position in ARK's venture portfolio, valued at roughly $1 billion.
My analysis: Wood's strategy is a high-risk game of anticipation that could either yield phenomenal returns or become another costly mistake. SpaceX is not Tesla. It doesn't have millions of units sold or an established consumer market. It's a business of the future that currently exists on promises and subsidies. Whether Starlink will deliver stable profits or turn out to be a bubble is a matter of time. But for ARK, which desperately needs a "gold mine," betting on space is perhaps the only way to regain investor trust.