Cathie Wood, chief of Ark Investment Management, frequently adjusts her top positions, adding to a holding when the stock falls and selling when it rises.
In the past week, she has sold shares of a popular tech stock that's been climbing this year.
Wood's funds have experienced a volatile ride lately, swinging from sharp losses to strong gains.
In January and February, the Ark funds rallied as investors bet on the Trump administration's potential deregulation that could benefit Wood's tech bets. But the momentum faded in March and April, with the funds trailing the market as top holdings -- especially Tesla, her biggest position -- slid amid growing concerns over the macroeconomy and trade policies.
Now, the Ark funds are making a strong comeback. As of Aug. 8, the flagship Ark Innovation ETF (ARKK) is up 29.7% year-to-date, far outpacing the S&P 500's 8.6% gain.
Wood's remarkable return of 153% in 2020 helped build her reputation and attract loyal investors. Her strategy can lead to sharp gains during bull markets but also painful losses, like in 2022, when ARKK dropped more than 60%.
As of July 30, Ark Innovation ETF, with $6.8 billion under management, has delivered a five-year annualized return of negative 1.46%. The S&P 500 has an annualized return of 15.5% over the same period.
Wood's investment strategy is straightforward: Her Ark ETFs typically buy shares in emerging high-tech companies in fields such as artificial intelligence, blockchain, biomedical technology, and robotics.
She says these companies have the potential to reshape industries, but their volatility leads to major fluctuations in Ark funds' values.
Related: Cathie Wood's net worth: The Ark Invest CEO's wealth & income
Over the 10 years ending in 2024, the Ark Innovation ETF wiped out $7 billion in investor wealth, according to an analysis by Morningstar's analyst Amy Arnott. That made it the third-biggest wealth destroyer among mutual funds and ETFs in Arnott's ranking.
Still, Wood has been bullish on the market. In a letter to investors published in late April, she dismissed predictions of a recession dragging into 2026 and struck an optimistic tone for tech stocks.
"During the current turbulent transition in the U.S., we think consumers and businesses are likely to accelerate the shift to technologically enabled innovation platforms including artificial intelligence, robotics, energy storage, blockchain technology, and multiomics sequencing," she said.