Cathy Wood makes a bold move: SpaceX vs Tesla on IPO day — Cryptalist analysis
June 12 became a landmark day for the stock market and for Cathie Wood personally. On the day of SpaceX's stock market debut, her ARK fund executed a massive portfolio rebalancing, purchasing approximately $444 million worth of SPCX shares while simultaneously reducing its position in Tesla. Both companies are owned by Elon Musk, but Wood's priorities have shifted — and this is a very telling signal.
Deal Details: $529.7 Million for SpaceX and a Reduction in Tesla
On the day of SpaceX's IPO, when the stock price surged 19% and Musk's net worth exceeded $1 trillion for the first time, ARK acquired 3.29 million shares at the offering price of $135. By the close of trading, this stake was already worth $529.7 million. On the same day, the fund cut its holdings in Tesla, as well as in Advanced Micro Devices, Rocket Lab, Roku, and Baidu.
This is a significant move by ARK's standards. 30% of the offering was allocated to retail investors — three to six times the usual level. SpaceX reported a cumulative loss of $41.3 billion as of March 31, but Wood appears to be betting on the future of Starlink, which is growing rapidly and is the company's only profitable division.
Why is Wood Turning Away from Tesla?
Tesla shares have long been ARK's main asset, and Wood publicly supported the company even during difficult times. Now things are different: Chinese competitors have nearly caught up with Tesla, its profitability is declining, and Musk's political activity is alienating some buyers. Wood first invested in SpaceX in late 2023, and now this company is the largest position in ARK's venture portfolio (about $1 billion). After the IPO, the fund can increase its investments on the public market.
ARK's Performance Context: Risks and Prospects
Since the beginning of the year, the ARK Innovation ETF has grown only 1.61%, while the S&P 500 has gained about 9%. Over the past 12 months, investors have withdrawn approximately $294 million net from it. According to Morningstar, from 2014 to 2024, ARK "destroyed" about $7 billion of its investors' funds. In the IPO sector, Cathie Wood follows one scenario: enter promising companies as early as possible. This is how ARK bought Coinbase shares shortly after its listing in 2021 and recently bet on CoreWeave.
My expert conclusion: Wood's decision is a classic play on anticipation. SpaceX, despite current losses, has unique potential in the space industry and satellite internet. However, ARK's history shows that early entry does not guarantee success — remember the same $7 billion in "destroyed" funds. Whether SpaceX will be another costly mistake or a brilliant bet remains to be seen, but one thing is clear: Wood is betting on a future that could change the game.