Cathy Wood makes a decisive move: SpaceX vs. Tesla — a battle of titans in the ARK portfolio
On the day of SpaceX's long-awaited IPO, June 12, Cathie Wood made a significant maneuver that clearly signaled a shift in her investment priorities. Her flagship ARK fund purchased shares of Elon Musk's space company for approximately $444 million, while simultaneously reducing its stake in Tesla — another brainchild of the same billionaire. This is not just a rebalancing, but a strategic signal that the market cannot ignore.
The deal was executed at the SPCX offering price of $135 per share. ARK acquired 3.29 million shares, and by the close of the trading session, this package was worth $529.7 million — a 19% increase in a single day. On the same day, the fund also cut positions in Advanced Micro Devices, Rocket Lab, Roku, and Baidu, reallocating capital in favor of its new core asset.
Why is Wood turning away from Tesla?
For a long time, Tesla was ARK's main bet, and Wood publicly supported the company even in its darkest times. However, the situation has now changed dramatically. Chinese competitors, such as BYD, have nearly caught up with Tesla in production volumes, its margins are declining, and Elon Musk's political activity is starting to alienate some consumers. Wood, as an experienced analyst, sees that Tesla's growth story is slowing down and is looking for new horizons.
With SpaceX, the picture is the complete opposite. The company's only profitable segment — Starlink satellite internet — is showing explosive growth. Wood first invested in SpaceX back in late 2023, and now this asset has become the largest position in ARK's venture portfolio, valued at approximately $1 billion. With the public market debut, the fund gains the ability to increase investments without the limitations of private capital.
ARK's return context: playing with fire
Since the beginning of the year, the ARK Innovation ETF has grown by only 1.61%, while the S&P 500 has gained about 9%. Over the past 12 months, investors have withdrawn approximately $294 million in net funds from the fund. According to Morningstar's estimate, from 2014 to 2024, ARK "destroyed" about $7 billion of its investors' capital. Against this backdrop, the bet on SpaceX looks like an attempt at rehabilitation — to get into a promising company as early as possible, similar to buying Coinbase immediately after its listing in 2021.
My expert opinion: Cathie Wood is acting according to the classic venture capital scheme — looking for "unicorns" at early stages. But SpaceX is not a startup; it is a mature giant with colossal losses ($41.3 billion in accumulated deficit). Whether this asset will become a life-saving anchor for ARK or another costly mistake — only time will tell. However, one thing is clear: the market is closely watching every move Wood makes, and her bet on space versus electric vehicles is a high-stakes gamble that could either restore ARK's former glory or finally undermine investor confidence.